In re City of New York

30 Misc. 3d 816
CourtNew York Supreme Court
DecidedDecember 9, 2010
StatusPublished
Cited by1 cases

This text of 30 Misc. 3d 816 (In re City of New York) is published on Counsel Stack Legal Research, covering New York Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In re City of New York, 30 Misc. 3d 816 (N.Y. Super. Ct. 2010).

Opinion

OPINION OF THE COURT

Abraham Gerges, J.

Claimant Exxon Mobil Corporation moves for an order, pursuant to Eminent Domain Procedure Law § 701, awarding it an additional allowance in the amount of $3,744,378.15 for actual and necessary costs, disbursements and expenses incurred.

Facts and Procedural Background

The City of New York acquired title to property formerly owned by Mobil Oil Corporation (hereinafter, Mobil Oil and its successor, Exxon Mobil, will be referred to as Mobil) on September 19, 1997 for use as part of the Newtown Creek Water Pollution Control Plant. As is also relevant herein, on or about September 19, 2000, the City commenced an action pursuant to Navigation Law § 181 (1), claiming that Mobil was strictly liable for the costs and damages resulting from the remediation, cleanup, and removal of petroleum which Mobil had previously discharged onto the property (City of New York v Mobil Oil Corp., Sup Ct, Kings County, index No. 32613/00 [the Navigation Law action]).

[818]*818There has been extensive motion practice and numerous court conferences in this proceeding since its inception. Briefly summarized,1 Mobil initially prepared a notice of claim on September 19, 1997. Mobil was then compelled to make a motion, which was returnable on April 16, 1998, to obtain an advance payment. As a result, an advance payment in the amount of $809,540, plus interest of $48,040.10, was made available on September 15, 1998; title issues were resolved and the payment was collected on April 16, 1999. On March 31, 2000, Mobil then served a motion seeking an order compelling the City to exchange its appraisal report. As a result of this motion, appraisal reports were exchanged on May 10, 2002. In its report, the City’s appraiser valued the subject property at $2,600,000, based upon the highest and best use for industrial development; the appraiser opined that after deducting the cost of demolition and the estimated future cleanup, which exceeded the value of the property, claimant should be awarded only the nominal sum of $1,000. By report dated February 18, 2000, Jerome Haims and Eric Haims of Jerome Haims Realty, Inc. (Haims), valued the property at $42.50 per square foot, or $10,330,000, assuming that the highest and best use was for “big box retail.” On December 7, 2000, the City served a supplemental appraisal report on Mobil and on the same day a trial was scheduled for April 12, 2001. On December 13, 2000, Mobil rejected the City’s supplemental appraisal report. On December 27, 2000, the City served a motion seeking to allow it to serve that report; the motion was granted by decision dated January 19, 2001. After additional reports were exchanged, at a pretrial conference held on October 25, 2001, the trial was scheduled for July 18, 2002.

On February 2, 2002, Mobil filed an in limine motion seeking an order excluding evidence at the condemnation trial of any diminution in the value of the property by reason of the remediation costs claimed in the Navigation Law action; the City cross-moved for additional discovery. By decision dated October 8, 2002, this court granted the motion and the cross motion (Mobil Oil Corp. v City of New York, 2002 NY Slip Op 50713[U] [2002]). The City appealed the decision. By motion served on March 18, 2003, Mobil moved to dismiss the appeal; by decision [819]*819entered on May 6, 2003, that application was denied. By decision dated October 25, 2004, the Appellate Division affirmed this court’s decision holding that evidence of the cost of environmental remediation should be excluded from the trial in the condemnation proceeding, but directed that the condemnation award be held in escrow pending the outcome of the Navigation Law action (12 AD3d 77, 85 [2004]).

On March 10, 2005, the City served a motion seeking additional discovery; that motion was denied by decision dated May 25, 2005. The trial was rescheduled to commence on September 19, 2005 because the City’s appraiser refused to testify, allegedly as the result of a fee dispute. By letter dated August 15, 2005, Mobil declined to stipulate that the City’s appraisal report could be admitted without the testimony of its expert at trial. When the City notified the court of its predicament at a conference on September 19, 2005, over Mobil’s objection, the court gave the City time to attempt to resolve the fee dispute. No agreement was reached and at a conference held on March 31, 2006, the court directed Mobil to exchange its appraisal report by May 30, 2006. By report dated April 24, 2006, Doris Silber of Jacques O. Tuchler & Associates valued the property at $24 per square foot, or $3,625,000, assuming that the highest and best use was for open storage of building materials. On July 17, 2006, Mobil filed a second in limine motion seeking to remove the issue of the demolition costs from the trial.

The trial commenced on July 26 and 27, 2006 and was adjourned because one of Mobil’s experts became ill. By letter dated August 14, 2006, the City advised Mobil that an additional advance payment in the amount of $2,825,460, plus interest in the amount of $1,503,224.23, was being deposited with the court. The trial continued on December 4, 5, 6, 7 and 8, 2006. By decision dated January 15, 2008, this court valued the subject property at $8,505,457; the parties were directed to hold the award in escrow until the conclusion of the Navigation Law action (Matter of City of New York, 18 Misc 3d 1118[A], 2008 NY Slip Op 50124[U] [2008] [the trial decision]). Mobil submitted an order and judgment that provided that interest on the award was to be calculated at 6%, compounded annually. The City proposed an order and judgment that provided that claimant would receive simple interest on the award. On February 21, 2008, this court signed Mobil’s order and judgment. The City nonetheless submitted a final decree which did not provide for compound interest; the parties then entered into a stipulation [820]*820pursuant to which the City’s right to appeal would be preserved although the final decree provided for compound interest. By a second separate and partial final decree dated April 3, 2008, this court awarded Mobil $8,505,457, with interest on the entire amount, excluding the advance payment, compounded annually at the rate of 6%. The City again appealed. By decision and order dated September 22, 2009, the Appellate Division modified the judgment by providing that the trial court should have applied the statutory rate of 6% simple interest and otherwise affirmed the trial decision (Matter of Newtown Cr. Water Pollution Control Plant Upgrade, 65 AD3d 1241 [2009]).

By letter dated November 13, 2009, Mobil notified the City that the Navigation Law action had been settled; by letter dated November 19, 2009, it notified the City that it would move for sanctions if an application was required to obtain the funds. By notice dated March 30, 2010, the City advised Mobil that $4,880,457, plus interest was available for payment, subject to proof of clear title. Mobil then brought a motion directing the release of the supplemental payment that had been deposited into the court; the City did not oppose the application and the court signed an order releasing the funds on March 26, 2010.

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Bluebook (online)
30 Misc. 3d 816, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-city-of-new-york-nysupct-2010.