Supreme Oil Company v. Metropolitan Transportation Authority, Metro-North Commuter Rail Division and New York City Transit Authority

157 F.3d 148, 1998 U.S. App. LEXIS 24616, 1998 WL 684964
CourtCourt of Appeals for the Second Circuit
DecidedOctober 5, 1998
Docket97-9581
StatusPublished
Cited by15 cases

This text of 157 F.3d 148 (Supreme Oil Company v. Metropolitan Transportation Authority, Metro-North Commuter Rail Division and New York City Transit Authority) is published on Counsel Stack Legal Research, covering Court of Appeals for the Second Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Supreme Oil Company v. Metropolitan Transportation Authority, Metro-North Commuter Rail Division and New York City Transit Authority, 157 F.3d 148, 1998 U.S. App. LEXIS 24616, 1998 WL 684964 (2d Cir. 1998).

Opinion

PER CURIAM:

I.

In 1979 the City of New York, on behalf of the New York City Transit Authority (“NYCTA”), condemned Supreme Oil Company’s (“Supreme”) Queens, New York, factory as part of a project to construct a new subway line. Supreme searched for a site to relocate its business, and eventually purchased tbe lot at 80 South Dean Street in Englewood, New Jersey (“Lot 2”), to which Supreme moved in 1981.

The subway project that forced the condemnation of Supreme’s location in Queens was funded in part by a grant to the Metro-politian Transportation Authority (“MTA”) from the United States Urban Mass Transportation Administration, an agency within the United States Department of Transportation. Due to this arrangement, Supreme was eligible to apply for relocation benefits under the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 (“URA”) which provides compensation to individuals and businesses displaced in the course of federally funded projects. See 42 U.S.C. § 4601 et seq. The URA provides, in pertinent part, that “the displacing agency” shall make payment to the displaced “person” of:

(1) actual reasonable expenses in moving himself, his family, business, ... or other personal property;
(2) actual direct losses of tangible personal property as a result of moving or discontinuing a business ... but not to exceed an amount equal to the reasonable expenses that would have been required to relocate such property as determined by the head of the agency;
(3)actual reasonable expenses in searching for a replacement business ...

42 U.S.C. § 4622(a).

In order to receive federal funds for projects, such as the subway construction that forced Supreme’s displacement, state and local agencies must certify that they will provide relocation benefits under the URA to affected persons and businesses. See 42 U.S.C. § 4604. The grantee agency may contract with another public or private agency to administer the relocation benefits, but the actual grantee remains at all times responsible for assuring that the federal funds are disbursed in compliance with the URA. In this case, MTA, the grantee agency, entered into a third-party contract with the New York City Department of Housing Preservation and Development (“HPD”), to administer URA claims and payments on MTA’s behalf.

Following its relocation to Englewood in 1981, Supreme filed several claims for URA benefits with HPD. Through 1984, HPD paid Supreme a total of $693,367.31 for three separate relocation claims. The first $430,991.31 of these payments was for two separate moving cost claims and the remaining $261,376 was for a “Physical Change Claim” stemming from Supreme’s construction of off-street parking and related outdoor improvements at the Lot 2 relocation site. The payment for Supreme’s moving expenses is not the subject of the parties’ present dispute. The Lot 2 Physical Change Claim, however, is directly related to the present appeal.

On October 26, 1982, Supreme sought and obtained approval for its relocation site from the Englewood Planning Board. Upon receiving this approval, Supreme was then required to obtain a Certificate of Occupancy (“C/O”) for the new location. On January 4, 1985, Englewood issued a C/O to Supreme for Lot 2.

In August of 1985, Supreme purchased a lot adjacent to Lot 2, located at 100 South Dean Street (“Lot 3”). On October 31, 1988, Supreme formally filed a Second Physical *151 Change Claim with HPD, seeking benefits for work contemplated on the combined Lot 2/Lot 3 site. For purposes of this litigation, the parties entered into a stipulation dated March 6,1997, stating that HPD did approve and recommend payment for at least part of Supreme’s Second Physical Change Claim. In October of 1989, HPD sought the necessary funds from MTA to pay this claim. MTA, however, refused to advance these funds.

Eventually, HPD Assistant Commissioner Peter Cantillo requested that A1 Shehadi, the department Director of Operations, prepare a final agency determination on Supreme’s Second Physical Change Claim. After examining the documentation relating to the claim and meeting with representatives from Supreme, Shehadi concluded that the claim should be rejected in its entirety because it was not directly related to Supreme’s initial relocation as required under the URA.

Soon thereafter, Supreme requested and was granted the opportunity to appeal She-hadi’s final agency determination denying compensation for its Second Physical Change Claim. An HPD attorney, A1 Schmidt, was initially assigned as a hearing officer in this administrative proceeding, but he was soon replaced by Roslyn Gottlieb. Schmidt, however, subsequently served as an attorney to HPD during this administrative hearing held before Gottlieb. Gottlieb affirmed Shehadi’s denial of the claim for many of the same reasons as Shehadi, but also considered information and issues not known nor addressed by Shehadi. Most significantly, she had available testimony and documents concerning the C/O for Lot 2 issued to Supreme in January of 1985 permitting her to find that Supreme had withheld evidence of having obtained the C/O, and that Supreme had already complied with all legal requirements for occupancy, leaving it ineligible for further reimbursement.

In July of 1996, Supreme commenced a proceeding in New York State Supreme Court to appeal HPD’s denial of its claim. On July 7, 1996 that action was removed to the Southern District of New York. In an order filed October 2, 1997, the district court granted defendants’ motion for summary judgment and dismissed Supreme’s claim in its entirety.

II.

It is well established that on appeal from a grant of summary judgment on a claim brought under the Administrative Procedure Act (“APA”), we review the administrative record de novo and accord no deference to the decision of the district court. City of New York v. Shalala, 34 F.3d 1161, 1166 (2d Cir.1994). Under the APA, a federal court may set aside an agency’s findings, conclusions or actions only if they are “arbitrary, capricious, an abuse of discretion, ... otherwise not in accordance with the law,” or “unsupported by substantial evidence.” 5 U.S.C. §§ 706(2)(A) and (E). We thus review an agency’s determination as would a district court, which means that we will set aside an agency’s findings “only if they are ‘arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with the law.’ ” Henley v. Food and Drug Admin., 77 F.3d 616, 619 (2d Cir.1996).

Review of an administrative agency’s denial of URA relocation benefits is under this narrow “arbitrary, capricious, ... abuse of discretion standard.”

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Bluebook (online)
157 F.3d 148, 1998 U.S. App. LEXIS 24616, 1998 WL 684964, Counsel Stack Legal Research, https://law.counselstack.com/opinion/supreme-oil-company-v-metropolitan-transportation-authority-metro-north-ca2-1998.