Reference no: EM131623384

Kaur v. New York State Urban Development Corp. 933 N.E.2d 721 Court of Appeals of New York June 24, 2010
Ciparick, J. In this appeal, we are called upon to determine whether respondent's exercise of its power of eminent domain to acquire petitioners' property for the development of a new Columbia University campus was supported by a sufficient public use, benefit or purpose.... I Petitioners in this proceeding are the owners of different commercial establishments located in the West Harlem neighborhood of Manhattan. Petitioners Parminder Kaur and Amanjit Kaur own a gasoline service station located on West 125th Street. Peti- tioners Tuck-It-Away, Inc., Tuck-It-Away Bridgeport, Inc., Tuck-It-Away at 133rd Street, Inc., and Tuck- It-Away Associates, L.P. (collectively TIA) own storage facilities located on Broadway and on West 131st and West 125th Streets. Petitioner P.G. Singh Enterprises, LLP also owns a gasoline service station located on West 125th Street.... II Petitioners' main argument on this appeal is that the Project approved by ESDC is unconstitutional because the condemnation is not for the purpose of putting properties to "public use" within the meaning of arti- cle I, §7(a) of the N.Y. Constitution, which provides that "[p]rivate property shall not be taken for public use without just compensation." First, petitioners vocifer- ously contend that ESDC's blight findings were made in bad faith and the Project only serves the private interests of Columbia. ESDC counters that the duly approved Project qualifies as a "land use improvement project" within the meaning of the Urban Develop- ment Corporation Act and that the Appellate Division plurality erred as a matter of law when it conducted a de novo review of the administrative record and con- cluded that the Project site was not blighted.... In Matter of Goldstein, we reaffirmed the long- standing doctrine that the role of the Judiciary is lim- ited in reviewing findings of blight in eminent domain proceedings.... [T]he determinations of blight and public purpose are the province of the Legislature, and are entitled to deference by the Judiciary.... Indeed, we observed that "[t]he Constitution accords government broad power to take and clear substandard and insanitary areas for rede- velopment. In so doing, it commensurately de- prives the Judiciary of grounds to interfere with the exercise."... These principles are based on a consistent body of law that goes back over 50 years.... Thus, a court may only substitute its own judgment for that of the legislative body authorizing the project when such judgment is irrational or baseless.... Applying this standard of review, as we must, we now look to the relevant statute. The UDC Act provides that, in the case of land use improvement projects, ESDC must find: (1) That the area in which the project is to be located is a substandard or insanitary area, or is in danger of becoming a substandard or insanitary area and tends to impair or arrest the sound growth and development of the municipality;(2) That the project consists of a plan or undertaking for the clearance, replanning, recon- struction and rehabilitation of such area and for recreational and other facilities incidental or appurtenant thereto; (3) That the plan or undertaking affords maximum opportunity for participation by private enterprise, consistent with the sound needs of the municipality as a whole.... The term "substandard or insanitary area" is defined as "a slum, blighted, deteriorated or deterio- rating area, or an area which has a blighting influence on the surrounding area."... Here, the two reports prepared by ESDC consultants-consisting of a volumi- nous compilation of documents and photographs of property conditions-arrive at the conclusion that the area of the Project site is blighted. Just as in Matter of Goldstein, "all that is at issue is a reasonable difference of opinion as to whether the area in question is in fact substandard and insanitary," which is "not a sufficient predicate ... to supplant [ESDC's] determination."... Thus, given our precedent, the de novo review of the record undertaken by the plurality of the Appel- late Division was improper. On the "record upon which the ESDC determination was based and by which we are bound" ... it cannot be said that ESDC's finding of blight was irrational or baseless. Indeed, ESDC consid- ered a wide range of factors including the physical, economic, engineering and environmental conditions at the Project site. Its decision was not based on any one of these factors, but on the Project site conditions as a whole. Accordingly, since there is record support "extensively documented photographically and other- wise on a lot-by-lot basis"... for ESDC's determination that the Project site was blighted, the Appellate Division plurality erred when it substituted its view for that of the legislatively designated agency. III Despite the objective data utilized by ESDC in its find- ing of blight, petitioners conclusorily assert that ESDC acted in "bad faith" and with pretext when it arrived at its determination.... Petitioners and the plurality at the Appellate Division particularly take umbrage at ESDC's decision to hire AKRF to conduct a neighbor- hood conditions study because Columbia had previ- ously engaged AKRF to prepare its EIS. Here, the record does not support petitioners' contention that the study conducted by AKRF was compromised simply because it separately prepared an EIS on behalf of Columbia. Moreover, ESDC-as a measure of caution and in response to criticism of its choice to retain AKRF-hired a second consulting firm, Earth Tech, to conduct review of the Project site. This company arrived at conclusions similar to AKRF's. Contrary to petitioners' assertions, Earth Tech did not merely review and rubber-stamp AKRF's study, but conducted its own independent research and gathered separate data and photographs of the area before arriving at its own conclusions. Fur- ther, unlike AKRF, Earth Tech had never previously been affiliated with or employed by Columbia. Simply put, petitioners' argument that ESDC acted in "bad faith" or pretextually is unsubstantiated by the record. IV In addition to attacking the neighborhood blight studies and ESDC's determination based on those studies, petitioners also challenge the constitutionality of the statutory term "substandard or insanitary area."... They argue that we should find this term void for vagueness. This contention is likewise unpersuasive.... It has long been settled that "civil as well as penal statutes can be tested for vagueness under the due process clause."... Due process requires that a statute be sufficiently definite "so that individuals of ordinary intelligence are not forced to guess at the meaning of statutory terms."... In the context of eminent domain cases, we have held that ... blight is an elastic concept that does not call for an inflexible, one-size-fits-all definition.... Rather, blight or "substandard or insani- tary areas," as we held in Matter of Goldstein and Yonkers Community Dev. Agency, must be viewed on a case-by-case basis. Accordingly, because the UDC Act provides adequate meaning to the term "substandard or insanitary area," we reject petitioners' argument that the statute is unconstitutionally vague on its face. V On appeal to the Appellate Division, petitioners argued that there were no findings of blight in the Project site prior to Columbia's acquisition of property there.... This argument is unsupported by the record.... Earth Tech found that, since 1961, the neighborhood has suffered from a long-standing lack of investment interest. Thus, since there is record support that the Project site was blighted before Columbia began to acquire property in the area, the issue is beyond our further review. We also conclude that ESDC properly qualified this Project, in the alternative, as a "civic project" within the meaning of the UDC Act.... A civic project is defined as "[a] project or that portion of a multi- purpose project designed and intended for the pur- pose of providing facilities for educational, cultural,recreational, community, municipal, public service or other civic purposes."... The plurality at the Appellate Division held that the expansion of a private university does not qualify as a "civic purpose." This conclusion does not have statutory support. Indeed, there is nothing in the stat- utory language limiting a proposed educational proj- ect to public educational institutions. In fact, the UDC Act encourages participation in projects by private entities.... Thus, there is no reason to depart from the plain meaning of the word "education" by limiting the term to public institutions. Moreover, consonant with the policy articulated in the UDC Act, ESDC has a history of participation in civic projects involving private entities. The most recent example of a civic project is the Atlantic Yards project, which authorized a private entity to construct and operate an arena for the Nets professional basketball franchise.... The petitioners in that case argued that the project did not qualify as a "civic project" because the arena would be used by a professional basketball team and operated by a private profit- making entity. In rejecting that argument, the Appel- late Division explained "that a sports arena, even one privately operated for profit, may serve a public purpose."... The proposed Project here is at least as compelling in its civic dimension as the private development.... Unlike the Nets basketball franchise, Columbia Univer- sity, though private, operates as a nonprofit educa- tional corporation. Thus, the concern that a private enterprise will be profiting through eminent domain is not present. Rather, the purpose of the Project is unquestionably to promote education and academic research while providing public benefits to the local community. Indeed, the advancement of higher education is the quintessential example of a "civic purpose."... It is fundamental that education and the expansion of knowledge are pivotal government in- terests. The indisputably public purpose of education is particularly vital for New York City and the State to maintain their respective statuses as global centers of higher education and academic research. To that end, the Project plan includes the construction of facilities dedicated to research and the expansion of laborato- ries, libraries and student housing. In addition to these new educational facilities, the Project will bestow numerous other significant civic benefits to the public. For example, the Project calls for the development of approximately two acres of gateless, publicly accessible park-like and land- scaped space as well as an open-air market zone along 12th Avenue. Other civic benefits include upgrades in transit infrastructure and a financial commitment to West Harlem Piers Park. Moreover, this Project is projected to stimulate job growth in the local area. In addition to hiring 14,000 people for construction at the Project site, Columbia estimates that it will accommodate 6,000 permanent employees once the Project is completed. In sum, there can be no doubt that the Project approved by ESDC-which provides for the expansion of Columbia's educational facilities and countless public benefits to the sur- rounding neighborhood, including cultural, recrea- tional and job development benefits-qualifies as a "civic project" under the UDC Act. VII Petitioners finally contend that they were denied procedural due process when ESDC both failed to turn over certain documents during the administrative process pursuant to their FOIL request and closed the record prior to completion of the FOIL litigation. Because ESDC did not withhold any documents that formed part of the administrative record ... we ... reject this argument as lacking merit.... It is well settled that procedural due process in the context of an agency determination requires that the agency provide an opportunity to be heard in a meaningful manner at a meaningful time.... In this case, petitioners had an opportunity to comment on the proposed Project in a meaningful manner-both orally and through written submissions-and at a meaningful time-well before ESDC issued its findings and determination to acquire petitioners' property by eminent domain. It should be emphasized that prior to the ESDC determination, petitioners had unfettered access to over 8,000 pages of documents including ... the AKRF and Earth Tech neighborhood conditions stud- ies. All of these documents were available to the public during the comment period.... Indeed, peti- tioners' substantial opportunity to be heard is re- flected in their extensive written submissions after the completion of the two-day public hearing. As a result, ESDC prepared 75 pages of detailed responses to petitioners' comments and duly considered their submissions before rendering its final findings and determination.... In sum, we give deference to the findings and determination of the ESDC that the Project qualifies as both a land use improvement project and ... a civic project serving a public purpose under the UDC Act. We further conclude that petitioners were not deprived of procedural due process. Accordingly, the order of the Appellate Division should be reversed, with costs, and the petitions should be dismissed.

Case Questions

1. What, according to New York's highest court, did the intermediate court of appeals do wrong?

2. How would you characterize the way New York has balanced the competing interests of small-business owners and those favoring economic development taking?

3. What are your thoughts about the public policy implications of this decision?