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CITY RYE ET AL. v. METROPOLITAN TRANSPORTATION AUTHORITY ET AL. (04/24/69)

COURT OF APPEALS OF NEW YORK 1969.NY.41339 <http://www.versuslaw.com>; 249 N.E.2d 429; 24 N.Y.2d 627 decided: April 24, 1969. CITY OF RYE ET AL., RESPONDENTS,v.METROPOLITAN TRANSPORTATION AUTHORITY ET AL., APPELLANTS. TOWN OF OYSTER BAY, INTERVENOR-RESPONDENT City of Rye v. Metropolitan Transp. Auth., 58 Misc. 2d 932, reversed. Counsel John R. Hupper, Bruce Bromley, Howard G. Kristol and James C. Hansen for Metropolitan Transportation Authority and another, appellants. Louis J. Lefkowitz, Attorney-General (Joel Lewittes and Samuel A. Hirshowitz of counsel), for J. Burch McMorran, as Commissioner, appellant. Counsel Edward N. Costikyan, Allan A. Tuttle and Robert S. Smith for City of Rye and others, respondents. Counsel Bernard F. McCaffrey, Town Attorney (Charles F. Lynch of counsel), for Town of Oyster Bay, intervenors-respondents. Counsel Daniel B. Goldberg for Niagara Frontier Transportation Authority, amicus curiae. Judges Scileppi, Breitel and Jasen concur with Judge Bergan; Judge Burke dissents and votes to affirm in a separate opinion in which Chief Judge Fuld and Judge Keating concur. Author: Bergan


City of Rye v. Metropolitan Transp. Auth., 58 Misc. 2d 932, reversed.

Judges Scileppi, Breitel and Jasen concur with Judge Bergan; Judge Burke dissents and votes to affirm in a separate opinion in which Chief Judge Fuld and Judge Keating concur.

Author: Bergan

 By chapter 717 of the Laws of 1967 the Legislature amended the Public Authorities Law in a number of respects and made relevant changes in related statutes. Among other things, in form, at least, it created the Metropolitan Transportation Authority or continued a previously created authority under this name (§ 83; Public Authorities Law, $1263). It also created the Niagara Frontier Transportation Authority (§ 96; Public Authorities Law, § 1299-c).

Plaintiff City of Rye and intervenor Town of Oyster Bay in their respective actions against the Metropolitan Transportation Authority and certain State officers for a declaratory judgment contend that chapter 717 is unconstitutional because it does not conform to the mandate of section 5 of article X of the New York Constitution.

This section provides that no public corporation having authority to contract indebtedness and to collect fees and charges shall be "created" except by "special act of the legislature". Concededly the Metropolitan Transportation Authority is that kind of a public corporation as, indeed, is the Niagara Frontier Transportation Authority.

The particular thrust of the attack by the city and by the town on the constitutionality of the 1967 statute is the provision of section 92, which added subdivision 9 to section 1266 of the Public Authorities Law. This subdivision empowers the Metropolitan Transportation Authority under certain prescribed conditions to build two bridges over Long Island Sound, one of which would be located as determined by the Authority in an area in the Town of Oyster Bay crossing to Westchester County at a point near the City of Rye.

The Court at Special Term granted judgment in favor of the city and the town declaring portions of the statute (Public Authorities Law, § 1266, subd. 9, par. [a], and parts of pars. [c], [d], [e]) added by section 92 of chapter 717 of the Laws of 1967 unconstitutional. The ground is not specified in the judgment. Reference to the opinion of the court discloses that the basis for the judgment is the court's view that the authorization to build the bridges was in contravention of the constitutional requirement that the public corporation authorized to do this must be created by special act.

The Metropolitan Transportation Authority and the State officers affected adversely in their powers by the declaratory judgment appeal directly to this court on constitutional grounds. The Niagara Frontier Transportation Authority has appeared as amicus curiae, contending that if the judgment at Special Term is right, its existence is imperiled since it was created by the same 1967 statute.

The judgment was specifically pointed to the section of the statute authorizing the building of the Rye-Oyster Bay bridge over Long Island Sound. Since section 5 of article X does not deal with a legislative direction to State officers or agencies to build bridges, but is concerned solely with the creation of public corporations, the validity, in the constitutional sense, of the power of the Metropolitan Transportation Authority to build bridges must necessarily depend on the validity of the creation of the corporation.

Although it is arguable, and has been suggested, that the Metropolitan Transportation Authority was actually created by an amendment to the Public Authorities Law in 1965 under the name Metropolitan Commuter Transportation Authority and that the 1967 statute was merely a continuance of the original corporate entity with a change of name and of some, but not all powers, it seems preferable to meet the issue squarely by treating section 83 of chapter 717 of the Laws of 1967 as having effected sufficiently substantial changes in the functions and powers of the corporation to treat the 1967 statute as an act of creation.

The court at Special Term seemed to have assumed in its opinion that the 1965 act of creation was valid. We agree with this assumption and find the act of 1967 in all important essentials equally valid.

The language of section 5 of article X originated in the recommendations of the Constitutional Convention of 1938 and it has an historic background beginning with the Constitutional Convention of 1846. In that year the Constitution was amended to provide that "Corporations may be formed under general laws; but shall not be created by special act, except for municipal purposes" (Constitution of 1846, art. VIII, § 1; now art. X, § 1, in identical language).

This provision was designed to prevent the creation of private corporations by special acts which had been subject to abuse; and to allow for their formation by anyone in accordance with a general statute (Bishop & Attree, Report of the Debates and Proceedings of the Convention for the Revision of the Constitution of the State of New York, pp. 221-222). For an early discussion of the policy underlying this provision, see Johnson v. Hudson Riv. R. R. Co. (49 N. Y. 455, 458).

The debates of the 1938 Convention indicate that the proliferation of public authorities after 1927 was the reason for the enactment of section 5 of article X (Revised Record, 1938 Convention, vol. 3, p. 2259). Abbott Low Moffat, who supported this proposal, told the convention that its purpose was "to require the Legislature to pass directly itself upon the establishment of each new authority, and to prevent the enactment of general laws pursuant to which a municipal corporation can itself create a corporation of the authority type" (op. cit., p. 2259).

Thus, the purpose was to prevent the Legislature from allowing the creation of public authorities in the manner in which, since 1846, it had been required to do with private corporations by a general statute, and require the Legislature itself to create them specifically by "special act".

It becomes manifest from the convention discussion that what was intended to be accomplished was a requirement that the State Legislature itself create public corporations of the type described and that their creation not be left either to administrative officers or to local governments and that is what is meant by "special act" in this context. As Mr. Moffat explained to the convention, it was the purpose of the framers of the section to see to it that "the power to create an authority shall not be delegated" (Record, p. 2260).

The term "special act" is not otherwise defined in this context by the Constitution. As it is used here it can only mean that a public corporation of this type must be created by a particular creative enactment of establishment by the Legislature. It cannot possibly mean that only one subject could be stated in the statute by which the corporation is created; or that in the statute creating the corporation the Legislature could not deal additionally with other ...


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