Wythe Berry, LLC v. N.Y.S. Dep't of Envtl. Conservation
| Decision Date | 25 November 2020 |
| Docket Number | 2015–12201,Index No. 505803/14 |
| Citation | 188 A.D.3d 1225,137 N.Y.S.3d 91 |
| Parties | In the Matter of WYTHE BERRY, LLC, appellant, v. NEW YORK STATE DEPARTMENT OF ENVIRONMENTAL CONSERVATION, et al., respondents. |
| Court | New York Supreme Court — Appellate Division |
Freeborn & Peters, LLP, New York, N.Y. (Jon Schuyler Brooks of counsel), for appellant.
Letitia James, Attorney General, New York, N.Y. (Steven C. Wu and Scott A. Eisman of counsel), for respondents.
MARK C. DILLON, J.P., JEFFREY A. COHEN, ROBERT J. MILLER, ANGELA G. IANNACCI, JJ.
DECISION & ORDER
In a hybrid proceeding pursuant to CPLR article 78 to review a determination of the respondent/defendant New York State Department of Environmental Conservation dated February 19, 2014, denying the application of the petitioner/plaintiff to participate in the Brownfield Cleanup Program (ECL art 27, tit 14), and action for declaratory relief, the petitioner/plaintiff appeals from a judgment of the Supreme Court, Kings County (Wavny Toussaint, J.), dated October 16, 2015. The judgment denied the petition and dismissed the hybrid proceeding and action.
ORDERED that the judgment is modified, on the law, by deleting the provisions thereof denying that branch of the petition/complaint which was to annul the determination of the respondent/defendant New York State Department of Conservation dated February 19, 2014, denying the application of the petitioner/plaintiff to participate in the Brownfield Cleanup Program (ECL art 27, tit 14), and dismissing that portion of the proceeding/action, and substituting therefor a provision granting that branch of the petition/complaint to the extent of annulling that determination; as so modified, the judgment is affirmed, with costs to the petitioner/plaintiff, and the matter is remitted to the Supreme Court, Kings County, for further proceedings in accordance herewith.
This appeal involves two parcels of real property located in Brooklyn (hereinafter the site). Between 1903 and 1965, the Site was part of a larger parcel of property that was owned and operated by Brooklyn Union Gas Company (hereinafter BUG) as a "manufactured gas plant" (hereinafter MGP). Following a merger, BUG became known as "KeySpan Energy Delivery New York" and "KeySpan Gas East Corporation d/b/a KeySpan Energy Delivery Long Island" (hereinafter KeySpan). In the years that followed, there were numerous changes in the ownership of the site.
In February 2007, KeySpan entered into an "Order on Consent and Administrative Settlement" (hereinafter the consent order), with the respondent/defendant New York State Department of Environmental Conservation (hereinafter the DEC), pursuant to which KeySpan, as the former owner and operator of certain MGP sites throughout New York, agreed to undertake an investigation into the presence of hazardous waste at those locations "to allow the [DEC] to determine whether a consequential amount of hazardous waste has been disposed at [those sites] and, if so, whether the contamination presents a significant threat to public health and/or environment." KeySpan also agreed to, inter alia, retain "professional consultants, contractors ... acceptable to the [DEC]," prepare and submit work plans to the DEC related to, inter alia, the development and implementation of remedial activities at the MGP sites, and "cooperate with the [DEC] ... in soliciting public comment on the proposed remedial action plan ... if any." In August 2007, the consent order was modified so as to make the site, as well as several other MGP sites, subject to the consent order. It is undisputed that National Grid N.Y. (hereinafter National Grid) subsequently acquired KeySpan and, as a result, became responsible for the obligations set forth in the consent order.
In July 2011, in accordance with the consent order, National Grid submitted a Site Characterization Work Plan (hereinafter the SC Work Plan) to the DEC, informing it that hazardous materials were present at the site. Over the course of the next two years, National Grid conducted certain field activities at the site, including "soil boring and monitoring well installation" in accordance with the SC Work Plan, which was approved by the DEC in August 2013.
In 2014, the petitioner/plaintiff (hereinafter the petitioner) acquired title to the site and planned to redevelop it into "a hotel, retail space, community facility space and office space including medical offices." In anticipation thereof, National Grid obtained approval from the DEC to submit to it an Interim Site Management Plan (hereinafter ISMP), "that sets out controls for the site, including how soil should be handled and air quality monitoring." National Grid was advised by the DEC that the petitioner "could excavate as long as it followed the protocols outlined in the ISMP."
In January 2014, the petitioner submitted an application to the DEC for the site's inclusion in the Brownfield Cleanup Program (hereinafter the BCP) (see ECL 27–1401 et seq. ). The Legislature passed the BCP in 2003 "to encourage [the] cleanup and redevelopment" of contaminated properties, known as "brownfield sites," that "threaten the health and vitality of the communities they burden" in exchange for certain benefits, including substantial tax credits and a release from liability ( ECL 27–1403 ; see ECL 27–1421 ; Tax Law §§ 21 – 23 ; Matter of Lighthouse Pointe Prop. Assoc. LLC v. New York State Dept. of Envtl. Conservation, 14 N.Y.3d 161, 165–167, 897 N.Y.S.2d 693, 924 N.E.2d 801 ). By letter dated February 19, 2014, the DEC denied the petitioner's application on two grounds. First, after noting that National Grid was already obligated under the consent order to "develop and implement a remedial program for the [S]ite," the DEC determined that the Site was ineligible for participation in the BCP because it was "the subject of an ongoing state enforcement action" (see ECL § 27–1405[2][e] ). Second, the DEC determined that "the public interest would not be served by granting the application" (see ECL 27–1407[9] ), since National Grid "[stood] ready to cooperate and complete the remediation in accordance with the [consent order]."
The petitioner subsequently commenced this hybrid proceeding and action seeking, inter alia, to annul the DEC's determination and a judgment declaring that its application was approved nunc pro tunc as of March 7, 2014, and that the DEC is liable for all damages suffered and costs incurred by the petitioner, including attorneys' fees, arising from the DEC's denial of the application. Around that same time, in June 2014, the DEC approved the ISMP that had been previously submitted to it by National Grid. According to the DEC, as of September 2014, the petitioner completed the excavation and "[i]t appear[ed] that the vast majority of contamination has been removed," and that "further on site work ... is not likely to be needed." In a judgment dated October 16, 2015, the Supreme Court denied the petition and dismissed the hybrid proceeding and action, concluding that "the public interest ... would not have been served by permitting [the petitioner] to enter the BCP program inasmuch as it would have triggered unnecessary financial obligations that would not have served the economic well being of the people of the state." The petitioner appeals.
"In a CPLR article 78 proceeding to review a determination of an administrative agency, the standard of judicial review is whether the determination was made in violation of lawful procedure, was affected by an error of law, or was arbitrary and capricious or an abuse of discretion" ( Matter of Sierra Club v. Martens, 158 A.D.3d 169, 174, 69 N.Y.S.3d 84 [internal quotation marks omitted]; see CPLR 7803[3] ). "Courts ‘regularly defer to the governmental agency charged with the responsibility for administration of [a] statute’ in those cases where interpretation or application ‘involves knowledge and understanding of underlying operational practices or entails an evaluation of factual data and inferences to be drawn therefrom,’ and the agency's interpretation ‘is not irrational or unreasonable’ " ( Matter of Lighthouse Pointe Prop. Assoc. LLC v New York State Dept. of Envtl. Conservation, 14 N.Y.3d at 176, 897 N.Y.S.2d 693, 924 N.E.2d 801, quoting Kurcsics v. Merchants Mut. Ins. Co., 49 N.Y.2d 451, 459, 426 N.Y.S.2d 454, 403 N.E.2d 159 ). "But where ‘the question is one of pure...
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