East Harlem Alliance of Responsible Merchants v City of New York

[*1] East Harlem Alliance of Responsible Merchants v City of New York 2009 NY Slip Op 51155(U) [23 Misc 3d 1136(A)] Decided on June 1, 2009 Supreme Court, New York County Lobis, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on June 1, 2009
Supreme Court, New York County

East Harlem Alliance of Responsible Merchants, UPTOWN HOLDINGS, LLC, HERON REAL ESTATE CORP., YORY, LLC, AND HEE NAM BAE, Plaintiffs-, Petitioners,

against

City of New York, CITY COUNCIL OF THE CITY OF NEW YORK, CITY PLANNING COMMISSION OF THE CITY OF NEW YORK, CITY OF NEW YORK DEPARTMENT OF HOUSING PRESERVATION AND DEVELOPMENT, NEW YORK CITY ECONOMIC DEVELOPMENT CORP., and DEPARTMENT OF SANITATION OF THE CITY OF NEW YORK, Defendants-, Respondents.



117242/08



Attorneys for Petitioners

FEERICK LYNCH MACCARTNEY

96 SOUTH BROADWAY

SOUTH NYACK, NY 10960

By: J. David McCartney, Jr., Esq.

Attorneys for Respondents

The City of New York

Law Department

100 Church Street

New York, New York 10007

By: Haley H. Stein, Esq.

Assistant Corporation Counsel

Joan B. Lobis, J.

In Motion Sequence Number 002, petitioners seek an order preliminarily and permanently enjoining respondents the City of New York (the "City") and the City's Department of Housing Preservation and Development ("HPD") from conducting a hearing or engaging in any proceedings pursuant to the New York Eminent Domain Procedure Law ("EDPL") concerning the acquisition [*2]of certain properties or engaging in any further process purporting to review the public purpose to be served by the acquisition of certain properties. On April 20, 2009, the City held an EDPL hearing, pursuant to EDPL §§ 202 and 203. Therefore, this portion of Motion Sequence Number 002 is moot. The application is not moot insofar as petitioners still seek to enjoin the City from continuing with the EDPL Article 2 process by enjoining the City from issuing findings and a determination.

This is a combined Article 78 petition and declaratory judgment action, whereby petitioners seek to challenge certain determinations of respondents with respect to an urban renewal plan in East Harlem. Specifically, petitioners challenge resolutions of the New York City Council that were enacted on October 7, 2008 to approve the 15th Amendment to the Harlem-East Harlem Urban Renewal Plan (the "Plan"). Petitioner East Harlem Alliance of Responsible Merchants is a non-profit voluntary association whose individual members are merchants and owners of real property and businesses in East Harlem. Upton Holdings, LLC is a domestic limited liability company that owns real property located at 213-223 East 125th Street, that is currently occupied by a two-story commercial structure that contains an automotive repair business that has been in operation for thirty years, and a not-for-profit counseling center on the second floor. Heron Real Estate Corp. is a domestic corporation that owns property located at 2449 Second Avenue that is leased to BP Products, N.A., which operates a service station. There is also a billboard stanchion on the property. Petitioner Yory, LLC is a domestic limited liability corporation that owns real property located at 230 East 127th Street, which contains a five-story commercial structure that houses a business called Cycle Therapy, which is in the business of providing motorcycle showrooms, sales and repairs. Petitioner Hee Nam Bae owns property located at 2315 Third Avenue, which contains a one-story commercial structure that is leased to a family-owned and operated commercial laundry and retail dry cleaning establishment. This facility is alleged to be the sole production facility for six other locations. Bae also owns property located at 208 East 126th Street, which is a parking lot, and owns property that is leased to a recycling company. It is alleged that there are plans for the construction of a two-story commercial building, but that these plans have been placed on hold because of the City respondents' plans for the property.

Factual Background

On November 20, 1968, the City of New York City Planning Commission ("CPC") enacted the Plan, which designated approximately 150 blocks in Harlem and East Harlem for redevelopment and rehabilitation. Over the last forty years, the Plan was amended fourteen times. It is the actions of respondents in enacting the 15th amendment to the Plan and the approval of the East 125th Street Project (the "Project") that petitioners challenge.

The Project would re-zone and redevelop three parcels of land situated over two full blocks within the perimeter boundary of the Plan. While petitioners acknowledge that most of the land is owned or controlled by the City, HPD, or other related municipal entities, petitioners also own property within the Project area. Some of petitioners' properties were specifically excluded from the Plan at its inception, but were added to the Plan in the 15th Amendment.

On March 17, 2008, HPD and the New York City Economic Development Corp. ("EDC") submitted the application for the 15th Amendment to the Plan, pursuant to the New York City [*3]Uniform Land Use Review Procedure ("ULURP"). The Project was submitted for approval simultaneously with the proposal to amend the Plan, and various other related actions. The City and HPD scheduled and conducted a series of public hearings. There was also an environmental review process to assess the environmental impact of the Project.

The ULURP process culminated in approval by the CPC on August 27, 2008, and approval by the New York City Council on October 7, 2008. The August 27, 2008 CPC resolution authorized the Project to go forward. The authorization contains an amendment to the Plan to enable the acquisition of the privately-owned parcels in the Project area.

After this petition was filed and just after respondents filed their responsive papers, HPD issued a notice, pursuant to EDPL §§ 201-204, of a public hearing to be held on April 20, 2009, in connection with the acquisition of certain properties and "to review the public use to be served by the [Plan] and its impact on the local environment and residents." It is this hearing that petitioners sought to enjoin, together with any continuation of the EDPL process, on the ground that the City has already conducted this review pursuant to ULURP and, therefore, is exempt from any further procedures under the EDPL.

Statutory Scheme

Article 2 of the EDPL sets forth the procedures to be employed before the City may acquire private property by eminent domain for pubic use, unless an exemption applies, as set forth in EDPL § 206 (see p.6, infra). The condemnor must conduct a public hearing. EDPL § 201. Notice of the hearing must be given at least ten (10) but no more than thirty (30) days prior to the hearing. EDPL § 202. At the hearing, the condemnor must outline the purpose, proposed location or alternative locations of the project, and "any other information it considers pertinent." Anyone in attendance at the meeting shall be given an opportunity to present an oral or written statement and to submit other documents. A record is to be kept, and copies of the record are to be available for public examination. EDPL § 203. Within ninety (90) days after the conclusion of the public hearings, the condemnor shall make its determination and findings, and must publish a synopsis of the determination and findings, as set forth in the statute. EDPL § 204.

Section 207 of the EDPL provides that any person or persons aggrieved by the condemnor's determination and findings made pursuant to § 204 may seek judicial review by bringing a proceeding in the appellate division of the supreme court, in the judicial department in the county where the proposed project is located. Such petition is to be filed within thirty (30) days of the condemnor's completion of the publication of its determination and findings. Once the petition is filed, the condemnor is obliged to file the full record of the proceedings with the court. EDPL § 207(A). The proceeding is then heard on the record and, by statute, is to be heard "as expeditiously as possible and with lawful preference over other matters." EDPL § 207(B). The court shall either confirm or reject the condemnor's determination and findings. EDPL § 207(C). The scope of review is limited to whether:

(1) the proceeding was in conformity with the federal and state constitutions,

(2) the proposed acquisition is within the condemnor's statutory jurisdiction or authority, [*4]

(3) the condemnor's determination and findings were made in accordance with procedures set forth in this article and with article eight of the environmental conservation law, and

(4) a public use, benefit or purpose will be served by the proposed acquisition.

EDPL § 207(C). The exclusive nature of a proceeding under § 207 is set forth in § 208, which provides that,

[e]xcept as expressly set forth in section two hundred seven, and except for review by the court of appeals of an order or judgment of the appellate division of the supreme court as provided for therein, no court of this state shall have jurisdiction to hear and determine any matter, case or controversy concerning any matter which was or could have been determined in a proceeding under this article.

Pursuant to EDPL § 206, there are certain circumstances when the condemnor is exempt from compliance with the provisions of Article 2. Buffalo Urban Renewal Agency v. Moreton, 100 AD2d 20, 23 (1984). As is relevant here, EDPL § 206(C) provides that Article 2 need not be complied with when,

pursuant to other law or regulation [the condemnor] undergoes or conducts or offers to conduct prior to an acquisition one or more public hearings upon notice to the public and owners of property to be acquired, and provided further that factors similar to those enumerated in subdivision (B) of section two hundred four herein may be considered at such public hearings.

EDPL § 206(C).[FN1] As pertains to the circumstances here, the City conducted a review pursuant to ULURP.

Preliminary Injunction

As set forth above, petitioners sought originally to enjoin respondents from holding a hearing pursuant to the EDPL. That hearing has already been held. Petitioners also seek to enjoin respondents from conducting any further proceedings concerning the proposed acquisition of certain properties, or engaging in any further process purporting to review the public purpose to be served by the acquisition of the properties to be served by the 15th Amendment to the Plan.

To obtain a preliminary injunction, petitioners are required to demonstrate (1) a likelihood of ultimate success on the merits; (2) irreparable injury absent the granting of provisional relief; and, [*5](3) a balancing of the equities in their favor. A1 Entertainment LLC v. 27th Street Property LLC , 60 AD3d 516 (1st Dep't 2009). To prevail on the merits, petitioners have to demonstrate that the City is somehow prohibited from engaging in proceedings under Article 2 of the EDPL.

Respondents concede that the City is not required to proceed under Article 2 of the EDPL after the ULURP review process is completed. Indeed, in Matter of City of New York (Grand Lafayette Props. LLC), 6 NY3d 540, 544 (2006), the Court of Appeals approved the City's utilization of the ULURP process as "an alternate condemnation procedure authorized under EDPL 206 (C)." But, nothing in the statutory scheme prohibits the City from engaging in the Article 2 process after ULURP. The Article 2 procedure is intended to provide for additional public comment and information. East Thirteenth Street Community Ass'n v. New York State Urban Development Corp., 84 NY2d 287, 294, (1994). Petitioners do not have a likelihood of success on the merits, since it appears that the City is permitted to proceed under Article 2, even after proceeding under ULURP.

The fact that there is a provision for a proceeding in the Appellate Division, which is given a preference by statute to reduce delay, goes to the question of irreparable harm. Petitioners cannot show how the EDPL Article 2 process harms them in any way. Petitioners argue that they may be forced to litigate two actions, in two different forums, with the possibility of inconsistent results, and incur additional expenses. The prospect of carrying on multiple litigations does not constitute irreparable harm. " Mere litigation expense, even substantial and unrecoupable cost, does not constitute irreparable injury.'" F.T.C. v. Standard Oil Co. of California, 449 U.S. 232, 244 (1980), quoting, Renegotiation Board v. Bannercraft Clothing Co., 415 U.S. 1, 24 (1974); Founders Ins. Co. Ltd. v. Everest Nat. Ins. Co., 41 AD3d 350, 351 (1st Dep't 2007). While petitioners repeatedly impugn respondents' motives in proceeding under Article 2, the fact is that nothing in the statutory scheme precludes a dual track proceeding. Ironically, while petitioners challenge the additional hearing, petitioners contend that the ULURP review process did not afford the community an adequate opportunity to voice their opposition.[FN2] The City's decision to proceed under Article 2 gave the public an additional opportunity to comment on the Project. And, contrary to petitioners' assertions, since the statutory scheme provides for expedited review, and requires the City to prepare and submit the full record, it is questionable whether petitioners can claim irreparable injury.

Finally, although not addressed by respondents, the balance of the equities does not tip in petitioners' favor. Petitioners contend that there will be further delay, but as set forth above, the proceedings under Article 2 are expedited by the Appellate Division. The remainder of petitioners' argument with respect to the balancing of the equities mirrors their argument with respect to irreparable harm. [*6]

Notably, while Article 2 provides for exemptions, nowhere in the statutory scheme is there any provision precluding the condemnor from pursuing both a proceeding under ULURP and a proceeding under the EDPL. While it is clear that the City does not have to comply with the EDPL process under these circumstances, the statutory scheme does not affirmatively prohibit the City from following the procedures in Article 2 of the EDPL after the ULURP process. For all of these reasons, the preliminary injunction is denied.

This constitutes the decision, order, and judgment of the court.

Dated: June, 2009

______________________________

JOAN B. LOBIS, J.S.C. Footnotes

Footnote 1: Section 204(B), which is referenced in § 206, provides that the condemnor shall specify, but shall not be limited to, the following items in its determination and findings: (1) the public use, benefit or purpose to be served by the proposed public project, (2) the approximate location for the proposed public project and the reasons for the selection of that location; (3) the general effect of the proposed project on the environment and residents of the locality; and, (4) such other factors as it considers relevant.

Footnote 2: Similarly, while petitioners contend that the City is trying to take "a second bite at the apple" by holding the EDPL hearing, and is engaging in a "duplicative and unnecessary" hearing, petitioners simultaneously contend that the ULURP process was "fundamentally flawed" and "deficient."