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BEACON SYRACUSE ASSOCS. v. CITY OF SYRACUSE

January 7, 1983

BEACON SYRACUSE ASSOCIATES, Plaintiff,
v.
THE CITY OF SYRACUSE, SYRACUSE URBAN RENEWAL AGENCY, NEW YORK STATE URBAN DEVELOPMENT CORPORATION, SYRACUSE CITY PLANNING COMMISSION, COMMON COUNCIL OF THE CITY OF SYRACUSE, SYRACUSE RENAISSANCE PARTNERS, LTD., and SYR MALL CORPORATION, Defendants



The opinion of the court was delivered by: MUNSON

MEMORANDUM-DECISION AND ORDER

 HOWARD G. MUNSON, C.J.

 I.

 Beacon Syracuse Associates (Beacon), a limited partnership organized under the laws of the Commonwealth of Massachusetts, is the redeveloper and present owner of real property known as Block 107 in the City of Syracuse.

 The defendants are the City of Syracuse (Syracuse), a municipal corporation; Syracuse Urban Renewal Agency (SURA), a public benefit corporation of the State of New York; New York State Urban Development Corporation (UDC), a corporate governmental agency of the State of New York; the Syracuse City Planning Commission (Commission), a governmental commission; the Common Council of the City of Syracuse (Council), a legislative and quasi-judicial body of the City of Syracuse, Syracuse Renaissance Partners, Ltd. (Renaissance), a limited partnership and Syr Mall Corporation (Syr Mall), a New York corporation. Renaissance and Syr Mall, joint venturers, are the current redevelopers and present owners of the real property known as Block 100 in the City of Syracuse, such property being the subject of this lawsuit.

 The gravamen of Beacon's complaint is that the use of the structure on Block 100, predominantly as an office complex, is violative of its constitutional and statutory rights and will cause Beacon substantial financial harm.

 More specifically and relevant to the motions presently before this Court, plaintiff asserts four claims against UDC under Title 42 United States Code, Section 1983: deprivation of property without due process; violation of equal protection; impairment of contract and condemnation of property without due process. Second, Beacon alleges a Title 42 United States Code, Section 1985, conspiracy violation against UDC, Syr Mall and Renaissance. Finally, Beacon asserts state law claims of breach of contract against UDC, Syr Mall and Renaissance and intentional interference with a contract against Syr Mall and Renaissance. The plaintiff seeks declaratory, injunctive and monetary relief. Jurisdiction is alleged under Title 28 United States Code, Sections 1331, 1332 and 1343. In addition, the plaintiff maintains that this court has pendent jurisdiction over the state claims.

 Presently before this Court are motions by defendant UDC to dismiss the complaint for lack of jurisdiction and for failure to state a claim; by defendant Renaissance to dismiss the complaint for failure to state a claim or, in the alternative, for summary judgment; and by Syr Mall to dismiss the complaint for lack of jurisdiction and for failure to state a claim or, in the alternative, for summary judgment. An apercu of the facts leading up to this lawsuit is in order.

 II.

 In the late 1960's, the City of Syracuse, acknowledging the gradual deterioration of the downtown region, undertook a comprehensive urban renewal program, the main objective of which was "to stimulate through the public actions and commitments . . ., private investment in redevelopment and rehabilitation in the City's central business area." Urban Renewal Plan § 101. As a consequence of that program, the Syracuse Common Council adopted the Clinton Square Urban Renewal Plan (URP) in July of 1968.

 The specific objectives of the URP include elimination of incompatible land use relationships; provision for the orderly growth of downtown; provision of a strong northern anchor of retail, office and other commercial development and establishment of a functional pattern of land use relationships. URP § 102.

 In addition to these general objectives, the URP provides more specific development objectives and land use provisions for distinct blocks encompassed by the URP. Relevant here, the primary objective of Blocks 100 and 107 under the original URP was "to provide for new major retail and office development including a major department store, office banking facilities and small retail shops to form a strong northern anchor to the retail core." URP § 303.2(h)(1). In furtherance of this objective, the Land Use Plan of the URP designated Block 107 as "Office and Service" and Block 100 as "C.B.D. Retail District."

 In order to implement the URP, Blocks 100 and 107 were acquired by SURA from the Department of Housing and Urban Development (HUD). SURA in turn entered into a contract with UDC (SURA-UDC contract) for the sale and redevelopment of these properties. Relevant to this lawsuit, UDC then entered into a contract with Beacon (UDC-Beacon contract) for the sale and redevelopment of Block 107, with Beacon obtaining title to the property by deed dated October 30, 1970, and recorded in Liber 2439 of Deeds at page 283. Block 107 was developed by Beacon as a banking facility and major office complex.

 The UDC retained title to Block 100 and developed it to provide the retail core, including Edwards, a large department store. Edwards fell victim to severe financial hardship and was later replaced by several small retail shops, being known as Syracuse Mall. That effort was also unsuccessful.

 In July, 1980, the Syracuse City Planning Commission, at the request of UDC, passed a resolution to change the zone for Block 100 from "C.B.D. Retail District" to "Office and Service," ostensibly to accommodate use of part of the Syracuse Mall as a facility for a radio station. The amendment was subsequently adopted, approved and passed by the Common Council, the Mayor and SURA, respectively.

 In August, 1981, the URP was once again amended, this time to change the development objective covering Lots 100 and 107. The new objective of Lots 100 and 107 was "to provide sites for new retail and office development to form a strong northern anchor to the downtown area" URP § 303(2)(h)(1). Beacon complains that it was not provided notice of the plan changes nor was its consent obtained, all in violation of the terms of the URP, various contracts, and Beacon's constitutional rights.

 On November 9, 1981, Block 100 was sold by UDC to Renaissance and Syr Mall, as joint venturers. Renovation of the Syracuse Mall building to provide predominantly office facilities was commenced in January, 1982. Completion of the renovation and initial occupancy were scheduled for November, 1982. At present the building remains vacant save for occupancy by the radio station.

 At issue in this lawsuit is whether the use of the building on Lot 100, known as the Atrium (formerly Syracuse Mall), predominantly as an office complex, is constitutionally and statutorily permissible.

 III.

 Addressing first, the defendants' motions to dismiss for lack of jurisdiction. Beacon has alleged jurisdiction under Title 28 United States Code, Sections 1331, 1332 and 1343. While the defendants concede jurisdiction under Title 28 United States Code, Section 1331, this Court finds that jurisdiction is also proper under Title 28 United States Code, Sections 1332 and 1343.

 The plaintiff is a citizen of Massachusetts while no defendant is a citizen of that state. Moreover, Beacon has alleged a matter in controversy, the value of which it asserts is in excess of $10,000. Insofar as a claim must not be dismissed for lack of jurisdiction unless it appears to a "legal certainty" that the amount in controversy is less than the jurisdictional amount, St. Paul Mercury Indemnity Co. v. Red Cab Co., 303 U.S. 283, 289, 82 L. Ed. 845, 58 S. Ct. 586 (1937), this Court finds that jurisdiction is proper under the diversity statute.

 Jurisdiction, likewise, is proper under Title 28 United States Code, Section 1343, since plaintiff's claims have sufficient substance to satisfy the very minimal standards of merit which must be met in order to confer jurisdiction upon this Court pursuant to that statute. See Hagans v. Lavine, 415 U.S. 528, 39 L. Ed. 2d 577, 94 S. Ct. 1372 (1974).

 Finally, in that this Court has diversity jurisdiction as to all claims, it need not address the issue of pendent jurisdiction.

 IV.

 Beacon's first claim against UDC and other defendants not joining in the motions presently before the Court is that Beacon has been deprived of property without due process of law. Complaint para. 53. In essence, Beacon alleges that it acquired a vested property right in the proper implementation and realization of the URP according to its terms and that the proper implementation of the URP required that Beacon consent to any modifications of the URP. Beacon further alleges that the deprivation of this right occurred when the URP was purportedly amended without Beacon's consent and subsequently, when development of the building on Block 100 as a major office complex began.

 Underlying this claim is the assumption that prior to the amendments of the URP, the building on Block 100 could not have been developed as an office complex. In this regard, plaintiff relies on the designation of Block 100 as "C.B.D. Retail," the development objectives of the URP and the fact that the URP was amended prior to the sale of Block 100 to Syr Mall and Renaissance.

 Block 100 was originally designated on the Land Use Plan of the URP as "C.B.D. Retail." The URP states the general proposition that permitted uses of "C.B.D. Retail" property include: "those retail uses which serve the metropolitan and regional market by virtue of their variety, quality, or specialization of merchandise, and those activities and services which serve the daily convenience needs of employees and shoppers . . . ." § 302.1 URP.

 More specifically, the URP states that property so designated may provide retail trade, services and offstreet parking. These are defined as follows:

 
(1) Retail Trade. Food, drugs, and liquor dealers; eating and drinking establishments; general merchandise retailers; apparel and accessories retailers; furniture; furnishings, and appliance stores; hardware stores; vehicle accessories stores; art dealers; antique dealers; book stores; stationary and art suppliers; sporting good stores; mail-order houses; toy and hobby shops; camera and photographic supply dealers; optical goods stores; cigar stores; news dealers; gift, novelty souvenir stores; and other compatible retail uses.
 
(2) Services. Administrative office headquarters; finance, insurance, and real estate services; business services; professional services; photographic studios; beauty and barber shops; shoe repair shops; instructional services; hotels and residential hotels; theaters; travel bureaus; and other compatible service uses.
 
(3) Offstreet Parking. Subject to the conditions specified in paragraph e. of this section.

 URP § 302.1(a)(1). This list of permitted uses, plaintiff maintains, clearly demonstrates that Block 100, designated "C.B.D. Retail," was to provide, in the main, a retail establishment.

 Plaintiff further supports this conclusion by reference to the development objective of Blocks 100 and 107 set forth in the original URP. In pertinent part it provides:

 
(1) the primary objective is to provide sites for new major retail and office development including a major department store, office banking facilities and small retail shops to form a strong northern anchor to the retail core.
 
(2) Blocks 100 and 107 are to provide a site for a large department store, a major supporting office facility including main office banking facilities and small retail shops that would provide: a strong anchor and focus to the northern edge of the retail core . . . .

 URP § 303.2(h).

 This, plaintiff asserts, demonstrates that the drafters of the URP contemplated the harmonious and complementary development of an office banking facility and a major retail outlet on these blocks. Accordingly, since Block 107 was designated "Office and Service" and was developed as an office and banking facility, plaintiff maintains that Block 100, originally designated "C.B.D. Retail," was to provide the retail component.

 Defendants, on the other hand, argue that the permissible uses provision of the Land Use Plan and the development objective were only guidelines and that, in any event, because "C.B.D. Retail" use category includes "Services," development of the building on Lot 100 as an ...


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