The opinion of the court was delivered by: ABRUZZO
A declaration of taking was filed in this proceeding in this Court on October 21, 1941, pursuant to Section 258a of Title 40 U.S.C.A., Act of February 26, 1931, ch. 307, Sec. 1, 46 Stat. 1421; and on October 22, 1941, a judgment on said declaration of taking was duly entered.
At the time of the filing of the declaration of taking, there was deposited in the registry of this Court the sum of $700,000 on account of the estimated just compensation and fair market value of the property taken.
Beard's Erie Basin, Inc., one of the defendants, appeared herein by its attorney and claims to be the party entitled to the sum so deposited and any further award which might be made. The Irving Trust Company is the trustee of a mortgage filed against this property on March 1, 1928. As trustee, it filed a notice of appearance in this proceeding. The City of New York also appeared as did many others which are unnecessary to recite since they are not pertinent to the claim in the present proceeding. The City of New York has not made a claim as to its being entitled to the award to be made.
Beard's, as claimant, has moved for an order directing the Clerk of this Court to pay to the Irving Trust Company, as trustee mortgagee, for the account of Beard's Erie Basin, Inc., the amount on deposit in the registry of this Court, to wit, $700,000, without prejudice to or waiver of the rights and claims of the claimant and said mortgagee, or either of them to proceed herein to have the just compensation for the land and improvements taken herein ascertained and awarded later in this proceeding.
The State of New York, upon the return of this motion, filed an adverse claim in writing. This claim in opposition to Beard's disputes the right of the claimant Beard's Erie Basin, Inc., to be compensated for the land and improvements acquired by the government, some of which was formerly under navigable waters; and asserts that it (the State) has a right to a portion of any award that might be made.
Thus, an issue at law has been presented relative to the rights of these parties to any preliminary award. There is sufficient authority for the Court to grant a preliminary award to any party in interest. Title 40 U.S.C.A. § 258a.
In view of the circumstances, the Court was unable to determine who the party in interest is and to whom the preliminary award should be made upon the affidavits submitted. The Court, with the consent of all parties, held hearings and took testimony in connection with the respective claims in order that it might properly pass upon the issue in dispute. A determination of this point is necessary before a final award can be made because the measure of damages to be applied will, to a greater or lesser extent, depend upon the decision to be made.
Beard's is attempting to sustain its right to its claim by the following chain of title: The upland title was in William Beard when he died in 1986, leaving a will with power of sale to his trustees. His surviving trustees and descendants conveyed to this claimant.
William Beard, it is claimed, received certain rights in the property herein (1) from letters patent granted by the State of New York, and (2) by legislative grants from the State.
By letters patent, dated June 25, 1857, pursuant to a resolution of the Commissioners of the Land Office, the State granted to William Beard and Valentine T. Hall certain land under water and between high and low water north of the bulkhead line of 1857 (claimant's exhibit 3). By letters patent dated September 1, 1885, pursuant to a similar resolution, the State granted to William Beard the land under water and between high and low water between the southerly boundary of the earlier grant and outer sea will line (claimant's exhibit 4).
Both grants are similar in form and state that they are made "for the purpose of promoting the commerce of our State and for no other use or purpose whatsoever, and with the reservations and upon the conditions hereinafter mentioned", and reserve to the People the right of using the property "until the same shall have been actually appropriated and applied to the purposes of commerce, by crecting a dock or docks thereon". The grantee was given ten years in the case of the first grant and five years in that of the second to actually appropriate the premises to the purposes of commerce for which it was granted.
Various grants were made by the legislature to the upland owners in the area which includes the premises here involved, giving the right "to erect, construct and build docks, wharves, bulkheads, piers and basins on the land under water in front of their lands in the City of Brooklyn. These grants began with Chapter 202 of the Laws of 1847, followed by Chapter 83 of the Laws of 1851, Chapter 203 of the Laws of 1856 and Chapter 184 of the Laws of 1851. By Chapter 763 of the Laws of 1857, bulkhead and pier lines for the Port of New York were established. Then followed Chapter 480 of the Laws of 1862 giving William Beard and others the right to build and maintain seawalls or breakwater piers and Chapter 481 of the Laws of 1862, altering the outer seawall line, and Chapter 856 of the Laws of 1866, authorizing William Beard and others to construct and maintain a bulkhead with solid filling on the bulkhead line of 1857. Chapter 702 of the Laws of 1873 permitted the construction and maintenance of bulkheads, wharves and piers and to fill in same on the lands under water in front of grantee's lands to the exterior bulkhead and pier lines. Chapter 491 of the Laws of 1884 attempted to ratify and confirm grants by prior acts with respect to the property in question "in fee simple". There were other grants at later dates but they were similar in form to those just recited and it is unnecessary to set them forth at great length.
In its lengthy brief, the State of New York makes two broad claims. It contends, first, that the letters patent, dated June 25, 1857, and September 1, 1885, gave a grant limited to its terms, to wit, for use by Beard's for the purpose of "promoting commerce of our State" only.
Secondly, the State broadly asserts that the legislative grants commencing in 1847 and including those up until 1884 were defective and were therefore ineffective. This claim is based upon the contention by the State that they were passed by only a three-fifths vote of the legislature where as a matter of law, to make them effective and operative, a two-third vote by the legislature was necessary. It is conceded they were passed by a three-fifths vote and that a two-thirds vote was necessary.
This latter argument of the State is disposed of in favor of the claimant in view of the decision in First Construction Co. v. State, 221 N.Y. 295, 116 N.E. 1020; Id., 110 Misc. 164, 180 N.Y.S. 241, which involved property immediately adjoining Beard's Erie Basin on the east. The upland owner of that property was the Estate of William Beard under the chain of title in evidence here, and the rights of the First Construction Company as grantee and assignee of the Estate of William Beard under the same legislative acts here involved were considered and adjudicated.
The State raised the identical defenses in that case as in its second contention herein, claiming the statute of 1884 was unconstitutional. This statute sought to ratify and confirm and defects in previous letters patent and legislative grants and particularly the ones in the instant case wherein and whereby Beard's is making claim for certain rights in the property acquired by the government. In addition it sought to convey to Beard's grants of title to land under water.
This latter phase of the statute was ruled to be unconstitutional, but the Court found that the part of the enactment which sought to confirm and ratify previous grants by letters ...