Denihan Enterprises, Inc. v. O'Dwyer

99 N.E.2d 235, 302 N.Y. 451, 1951 N.Y. LEXIS 719
CourtNew York Court of Appeals
DecidedMay 24, 1951
StatusPublished
Cited by91 cases

This text of 99 N.E.2d 235 (Denihan Enterprises, Inc. v. O'Dwyer) is published on Counsel Stack Legal Research, covering New York Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Denihan Enterprises, Inc. v. O'Dwyer, 99 N.E.2d 235, 302 N.Y. 451, 1951 N.Y. LEXIS 719 (N.Y. 1951).

Opinions

Froessel, J.

In this taxpayer’s action brought under section 51 of the General Municipal Law, plaintiff-respondent seeks to enjoin the City of New York and its board of estimate from carrying out a contract made with the New York Life Insurance Company, hereinafter called the Company. Special Term dismissed the complaint for legal insufficiency. The Appellate [456]*456Division unanimously reversed, denied the motion to dismiss, granted a temporary injunction, and certified to us the following question: “ Was the order of Special Term, dated May 2, 1950, granting defendants’ motion to dismiss the complaint, on which judgment was entered May 12,1950, properly made? ”

Under the contract challenged, the city agrees (1) to acquire by condemnation, pursuant to subdivision 3 of section 72-j of the General Municipal Law (L. 1949, ch. 453) about two thirds of the block (the easterly portion) bounded by East 64th and East 65th Streets, Second and Third Avenues, Manhattan; (2) to offer the same at public auction; (3) for a term of fifty years; (4) upon certain terms and conditions hereinafter referred to; (5) subject to conditions providing for the construction of a public parking garage, and (6) for commercial facilities.

The Company agrees to bid for the lease, as proposed, which shall be subject to the following conditions:

(a) The successful bidder shall construct on said real property a public parking garage (title to which shall vest in the city) accommodating at least 750 cars;

(b) the structure may include stores and other commercial facilities on the ground and basement floor along Second Avenue to a depth of 130 feet;

(c) the structure may not exceed 2 stories in height (with cellar and subcellar);

(d) the roof must contain 4 feet of sod, grass and planting;

(e) the initial rent shall consist of the total awards, interest and expenses of this condemnation as well as for a condemnation for widening East 65th Street 14 feet, plus taxes accruing between condemnation and the execution of the lease, $836,450 of which must be paid five days prior to such execution, and the balance five days after the amount thereof is certified by the city comptroller; in addition, there shall be paid an annual rental of at least $25,200;

(f) the successful bidder (lessee) shall remove all tenants (of which there are more than 100);

(g) the city agrees to rezone 11 for the purposes of the said lease ’ ’ the area condemned;

(h) the south half of the landscaped roof shall be improved “as a public sitting park ”;

[457]*457(i) the lessee may determine the amount of space allotted for storage or transient use ”, but shall consider ” the following recommendations of the traffic commission:

“ This garage will fill a need for storage space for the automobiles owned by the residents of the area and will afford a limited amount of space for transient parking during the day.”

(j) The garage rates to be charged to be approved by the city, but lessee may charge after operating expenses a return ” of 6% annually on the original investment [very broadly defined] to cover interest, yield, depreciation, obsolescence and amortization ”; and

(k) the lessee shall pave, landscape, and construct a mall and improve East 65th Street and relocate the facilities therein, all of which shall be deemed part of the “ investment

Plaintiff contends that the contract is illegal because (1) the use contemplated is not public but private; (2) it is not authorized by the statute (General Municipal Law, § 72-j, subd. 3) since that statute relates to “ parking garages or parking spaces ” (italics supplied), and the contract here contemplates primarily a storage garage; (3) even if authorized and found in some respects to be public in nature, it is so subordinated to the private benefit of the Company that the end result is a private use; (4) the contemplated use would violate the zoning resolution of the city, and its contractual obligation to rezone is illegal;

(5) the contract specifications are such as to discourage competitive bidding and will insure that the only bidder at the sale will be the Company, particularly since it alone will receive many very valuable benefits therefrom, thereby depriving the city of the opportunity to obtain the highest marketable rental as required by the statute and the New York City Charter, and

(6) the provision for a fifty-year lease is in violation of subdivision b of section 384 of the charter.

It is well settled that whether or not a proposed condemnation is for a public purpose is a judicial question (Matter of Deansville Cemetery Assn., 66 N. Y. 569; Matter of Niagara Falls & Whirlpool Ry. Co., 108 N. Y. 375; Pocantico Water Works Co. v. Bird, 130 N. Y. 249); but legislative findings in this respect are entitled to great weight (Matter of Murray v. La Guardia, 291 N. Y. 320; Matter of New York City Housing Authority v. Muller, 270 N. Y. 333). Judicial examination is less [458]*458critical, however, where the State itself is to be vested with the property (Matter of Long Sault Development Co. v. Kennedy, 158 App. Div. 398, affd. 212 N. Y. 1, writ of error dismissed 242 U. S. 272). It is equally well settled that proceedings in eminent domain to acquire property for street or park purposes are constitutionally permissible as serving a public purpose. (Matter of City of New York [Clinton Ave.], 57 App. Div. 166, 171, affd. 167 N. Y. 624; Brooklyn Park Comrs. v. Armstrong, 45 N. Y. 234, 239, 240; People v. Adirondack Ry. Co., 160 N. Y. 225, 247-248, affd. sub nom. Adirondack Ry. Co. v. New York, 176 U. S. 335.) Nor do we question the legality of the concept that private property may be condemned for parking motor vehicles when the public is primarily served in the taking of such vehicles from our streets to relieve traffic congestion. But whether or not the use here contemplated, and the method in which it is exercised, is authorized, is another question.

We are here and now solely concerned with the legal sufficiency of plaintiff’s complaint. Giving the pleader the benefit of every favorable inference, and assuming the truth of the allegations of its complaint, as we must (Blanshard v. City of New York, 262 N. Y. 5, 12; Abrams v. Allen, 297 N. Y. 52) notwithstanding the fact that its proof may well fall far short of establishing them as facts, we cannot say as a matter of pleading that no cause of action whatsoever is set forth, and that no triable issues are presented.

Without setting out the detailed allegations of plaintiff’s complaint, sufficient facts are alleged purporting to show that the public use here may be only incidental and in large measure subordinate to the private benefit to be conferred on the Company, and not for the purposes authorized by the statute. Of course an incidental private benefit, such as a reasonable proportion of commercial space, is not enough to invalidate a project which has for its primary object a public purpose

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99 N.E.2d 235, 302 N.Y. 451, 1951 N.Y. LEXIS 719, Counsel Stack Legal Research, https://law.counselstack.com/opinion/denihan-enterprises-inc-v-odwyer-ny-1951.