Matter of National Fuel Gas Supply Corp. v SchuecklerMatter of National Fuel Gas Supply Corp. v Schueckler
Matter of National Fuel Gas Supply Corp. v Schueckler, 167 AD3d 128, reversed.
Stein, J.
In 2017, the Federal Energy Regulatory Commission issued
I.
The question before us distills to whether the certificate of public convenience and necessity issued by the Federal Energy Regulatory Commission (FERC) to National Fuel satisfies
A. The Natural Gas Act
The Natural Gas Act (NGA) regulates the interstate sale and transport of natural gas (see
FERC may “attach to the issuance of the certificate and to the exercise of the rights granted thereunder such reasonable terms and conditions as the public convenience and necessity may require” (
With regard to eminent domain, the NGA provides that, when a certificate of public convenience and necessity is granted by FERC and the “holder” thereof “cannot acquire by contract . . . the necessary right-of-way to construct, operate, and maintain a pipe line . . . , it may acquire the same by the exercise of the right of eminent domain” (
B. The Eminent Domain Procedure Law
In New York State courts, the EDPL provides the “exclusive procedure by which property shall be acquired by exercise of the power of eminent domain” (
“A number of alternative procedures that a condemnor may undertake are outlined in
“[t]he condemnor shall be exempt from compliance with the provisions of . . . article [2] when:
“(A) pursuant to other state, federal, or local law or regulation it considers and submits factors similar to those enumerated in [
EDPL 204 (B) ], to a state, federal or local governmental agency, board or commission before proceeding with the acquisition and obtains a license, a permit, a certificate of public convenience or necessity or other similar approval from such agency, board, or commission” (emphasis added).
Thus, under this provision, a condemnor need not duplicate public benefit review undertaken by a governmental agency, so long as the review considers factors similar to those relevant to the EDPL eminent domain analysis and results in approval of the project.
Once the prerequisites of article 2 are satisfied by either compliance with the hearing procedures or the application of an exemption, “the condemnor must seek the transfer of title to the property by commencing a judicial proceeding known as a vesting proceeding pursuant to EDPL article 4” (Hargett, 13 NY3d at 328). In conjunction with the vesting proceeding, the condemnor must file, among other things, “a statement providing either the compliance with the requirements of article [2] of th[e] [EDPL], . . . or a statement providing the basis of exemption from article [2]” (
Meanwhile, if a condemnor issues public use findings and a determination under
II.
Turning to the appeal before us, in 2017, National Fuel commenced this EDPL vesting proceeding seeking to acquire, by eminent domain, temporary construction easements and a 50-foot-wide permanent easement over certain property owned by respondent landowners Joseph and Theresa Schueckler in order to facilitate construction and operation of a natural gas pipeline.2 National Fuel asserted that it had unsuccessfully attempted to negotiate a purchase of the easement,3 and that compliance with article 2 of the EDPL was satisfied through the statutory exemption set forth in
Respondent landowners contested National Fuel‘s EDPL petition, asserting that the certificate was ineffective because, while it authorized National Fuel to construct and operate the pipeline, such authority was conditioned upon “compliance with [certain] environmental conditions,” including the requirement that, ”[p]rior to receiving written authorization . . . to commence construction of any [p]roject facilities, National Fuel shall file with [FERC] documentation that it has received all applicable authorizations required under federal law (or evidence of waiver thereof).” According to respondents, this condition was not met—and the FERC certificate was therefore invalidated—due to the subsequent denial of National Fuel‘s application for a water quality certification by the New York Department of Environmental Conservation (DEC).
In response, National Fuel conceded that DEC had denied its application. However, National Fuel explained that it was seeking rehearing and clarification of the FERC order, as well as a ruling that DEC had waived its authority to deny the water quality certification by failing to timely decide National
Supreme Court granted National Fuel‘s EDPL petition, concluding that it had “made a prima facie showing of entitlement to the easements” based on the FERC certificate, which “exempt[ed] [National Fuel] from the requirements of [a]rticle 2 of the EDPL.” That court rejected the landowners’ claim that the certificate was ineffective for eminent domain purposes because it was conditional, observing that the certificate conditioned “construction and operation of the pipeline“—as compared with the “issuance of the certificate“—on various prerequisites. With regard to DEC‘s denial, the court observed that “the issue is not whether National Fuel has or will be able to obtain the necessary water quality permits from DEC, but whether it may initiate eminent domain proceedings” and that “water quality permits may be a precondition to pipeline construction, but not to the initiation of eminent domain proceedings.” Thus, the court held, National Fuel was exempt from the requirements of article 2 of the EDPL and was entitled to obtain the easements through eminent domain.
Upon the landowners’ appeal, the Appellate Division—with two Justices dissenting—reversed and dismissed National Fuel‘s EDPL petition (167 AD3d 128 [4th Dept 2018]). That Court reasoned that DEC‘s denial of National Fuel‘s application for a water quality certification meant that “[National Fuel] no longer holds a qualifying federal certificate for purposes of the
III.
Before this Court, National Fuel argues that the Appellate Division erroneously concluded that DEC‘s denial of its water quality certification application invalidated the FERC-issued certificate of public convenience and necessity for purposes of
It is well settled that, ” ‘[w]hen presented with a question of statutory interpretation, [a court‘s] primary consideration is to ascertain and give effect to the intention of the Legislature’ ” (Samiento v World Yacht Inc., 10 NY3d 70, 77-78 [2008], quoting Matter of DaimlerChrysler Corp. v Spitzer, 7 NY3d 653, 660 [2006]). ” ‘[T]he clearest indicator of legislative intent is the statutory text, [and] the starting point in any case of interpretation must always be the language itself, giving effect to the plain meaning thereof’ ” (Kuzmich v 50 Murray St. Acquisition LLC, 34 NY3d 84, 91 [2019], quoting Majewski v Broadalbin-Perth Cent. School Dist., 91 NY2d 577, 583 [1998]). Generally, “courts should construe unambiguous language to give effect to its plain meaning” (Matter of DaimlerChrysler Corp., 7 NY3d at 660).
The text of
While it is true that the certificate of public convenience and necessity contains numerous “conditions“—including, that of obtaining a water quality certificate and other pre-construction conditions that might affect the ultimate completion of the project—these conditions cannot reasonably be understood to render the certificate provisional for purposes of eminent domain, as the dissent suggests (see dissenting op at 321), inasmuch as they are not conditions precedent to the validity of the certificate itself. Notably, the certificate otherwise clearly delineates those circumstances in which FERC sought to prevent National Fuel from taking a particular act until after some condition was satisfied. Indeed, some of the “conditions” in the FERC certificate cannot be met without possession of the land.8 FERC could have conditioned National Fuel‘s eminent domain authority on the completion of some act or obligation (see e.g. Mid Atl. Express, LLC v Baltimore County, Md., 410 Fed Appx 653, 657 [4th Cir 2011]), but the “condition” that National Fuel comply with various environmental requirements—including the receipt of a water quality certification—“[p]rior to receiving written authorization . . . to commence construction” (emphasis added) does not, by its plain terms, curtail National Fuel‘s right to proceed with eminent domain in accordance with the EDPL. Thus, neither the EDPL nor the
Ultimately, since before commencement of the vesting proceeding, and continuing to the present day, National Fuel has held a valid certificate of public convenience and necessity issued by FERC—after extensive review of the factors set forth in
To reach a contrary conclusion, the Appellate Division majority looked beyond the facial validity of the FERC certificate and analyzed National Fuel‘s compliance with the certificate‘s conditions. However, the language of
To be sure, the Appellate Division‘s concern that the power of eminent domain should be exercised only for viable projects is legitimate; both our State and Federal Constitutions permit the taking of property by eminent domain only for public use
Moreover, the legislature was aware of the risk that property might be taken through the exercise of eminent domain for a public use that ultimately does not come to fruition, and it accounted for such a possibility in the EDPL. For example, if a condemnor abandons a project for which property was acquired by eminent domain,
In addition to reading language into
Of course, as the Appellate Division observed, the federal reservation of the right of states to issue water quality certifications was intended to “continu[e] the authority of the State . . . to act to deny a permit and thereby prevent a Federal license or permit from issuing to a discharge source within such State” (S. D. Warren Co. v Maine Bd. of Environmental Protection, 547 US 370, 380 [2006] [internal quotation marks and citation omitted]). Here, however, while DEC retained authority to grant or deny National Fuel‘s application for a water quality certification (unless deemed waived), such authority did not extend either to invalidating a previously issued FERC certificate of public convenience and necessity where FERC placed no such conditions on the certificate‘s effectiveness or to blocking eminent domain that might otherwise properly proceed under the certificate and the EDPL. It remains within FERC‘s purview to determine the effect of the DEC‘s denial on National Fuel‘s certificate of public convenience and necessity, and to stay or revoke the certificate if it deems it appropriate to do so.
In sum, where, as here, a gas company holds a valid certificate of public convenience and necessity from FERC for the proposed construction of a pipeline and that certificate places no relevant conditions on the eminent domain power and has not been stayed or revoked by FERC or a federal court properly reviewing its issuance, compliance with article 2 is excused under
Rivera, J. (dissenting). Petitioner National Fuel Gas Supply Corporation (the Corporation) wants to build a transborder gas pipeline across dozens of creeks and streams in Western New York, and to that end it sought easements on land owned by respondents Joseph A. and Theresa F. Schueckler. The Schuecklers refused to voluntarily sell their possessory use or full ownership rights to the Corporation. That might have been the end of the story, because if an owner refuses an offer to purchase, the prospective buyer is generally left out in the cold (see Loretto v Teleprompter Manhattan CATV Corp., 458 US 419, 435 [1982] [“The power to exclude has traditionally been considered one of the most treasured strands in an owner‘s bundle of property rights“]; J.E. Penner, The “Bundle of Rights” Picture of Property, 43 UCLA L Rev 711, 746-750 [1996]; Katrina M. Wyman, In Defense of the Fee Simple, 93 Notre Dame L Rev 1, 11 [2017]). Not so here.
After the Schuecklers refused to sell part of their homestead land, the Corporation commenced a proceeding to vest title in itself, invoking New York‘s eminent domain power to condemn private property for public use. However, because New York had not completed its water quality certification assessment
In concluding that the Corporation may rely on a Federal Energy Regulatory Commission certificate to satisfy its burden under the EDPL, even though the certificate expressly conditions the project on completion of additional federal and state mandatory assessments with the potential to stop the project, the majority measures the certificate by its title, the equivalent of “judging a book by its cover.” Metaphorically, and as a matter of law, no good can come from this. Indeed, the majority misinterprets the federal regulatory process and the EDPL condemnation framework, and in so doing sanctions the condemnation of private property for development projects that may never gain final approval. I do not see how the public benefits from the premature taking of private land, and therefore I dissent.
I. The Parties and the Proposed Gas Pipeline Project
The Schuecklers, a married couple, resided upon and owned as tenants by the entirety 200 acres of forested property in Allegany County in Western New York State. National Fuel Gas Supply Corporation is a large fossil fuel company, and a subsidiary of the publicly traded National Fuel Gas Company. It intends to build a pipeline (called Northern Access) stretching across 99 miles of Pennsylvania and New York. The pipeline‘s capacity is intended to be used by Seneca Resources, an affiliate of the Corporation, to transport natural gas, largely to Canada. Construction will entail clear-cutting a 75-foot-wide swath along the length of the proposed pipeline, including a stretch across the middle of the Schueckler forested property.
In accordance with the requirements of the Natural Gas Act (NGA), the Corporation applied for and obtained a Federal Energy Regulatory Commission (FERC) certificate of public convenience and necessity for the project (see
II. The FERC Certificate and Acquisition of Private Property under New York‘s Eminent Domain Law
To justify the exercise of the State‘s power of eminent domain for an ostensibly private commercial enterprise, the Corporation relied on the FERC certificate. The majority concludes that this certificate is sufficient under the EDPL to support vesting title in the Corporation to the Schueckler land. The majority‘s analysis is flawed in at least two respects. First, it assumes that this certificate grants final unconditional approval of a static project. In fact, the certificate recognizes that the project is subject to additional evaluation under the Clean Water Act, which grants New York the right to halt the project if it denies the Corporation a water quality certification (WQC) based on the State‘s pre-construction environmental review. Second, the majority analysis turns on a misreading of the EDPL as prohibiting judicial consideration of the underlying terms of this FERC certificate to determine whether FERC granted approval after considering the factors set forth in
A. FERC Certificate of Public Convenience and Necessity
The majority accurately summarizes the NGA and FERC‘s statutory authority to review gas pipeline applications, but fails to account for the fact that issuance of this FERC certificate of public convenience and necessity is provisional and part of a dynamic process. Indeed, the FERC certificate at issue here has gone through numerous and varied pre- and post-filing design changes. As the certificate recounts, the project details were subject to negotiation, amendment, clarification, and modifications, all in response to FERC and the concerns of stakeholders. At the end of this stage of the process, FERC issued a provisional certificate, which approved the Corporation‘s application for its proposed pipeline project, subject to “environmental and other conditions,” some of which involve pre-construction assessments which, if unfavorable to the Corporation, may prevent completion of the project.
In part, the changes to the early pipeline design reflect that this is a controversial project that has garnered substantial opposition. According to the certificate, the pipeline was opposed by numerous groups and stakeholders, who “question[ed] the need for the [pipeline] because much of the project‘s . . . service will be used to transport gas to Canada,” such that it would “only . . . benefit [the Corporation‘s affiliates‘] shareholders,” and argued “that the project imposes burdens on the U.S. public without providing proportional benefits to U.S. consumers.”1
Stakeholders also criticized FERC‘s handling of the project application, including, with particular relevance to this appeal, FERC‘s decision to forgo preparation of an environmental impact statement, relying instead on its staff‘s environmental assessment. An “environmental impact statement” is “a detailed statement describing the environmental impact of the proposed action“; under the National Environmental Policy Act of 1969, an agency is required to create such a statement “upon proposing a ‘major federal action’ that will ‘significantly affect the quality of the human environment’ ” (Pogliani v United States Army Corps of Engrs., 306 F3d 1235, 1237 [2d Cir 2002], quoting
Despite the objections to the project, FERC issued the certificate to the Corporation, subject to conditions. Specifically, the Corporation must “file with the Secretary documentation that it has received all applicable authorizations required under federal law (or evidence of waiver thereof).” FERC has no discretion to supplant the federal statutory approvals independent of the FERC certification process because FERC “must ensure that the project complies with the requirements of all relevant federal laws, including . . . the Clean Water Act” (Islander E. Pipeline Co., LLC v Connecticut Dept. of Envtl. Protection, 482 F3d 79, 84 [2d Cir 2006]). In turn, the Clean Water Act provides that
“[a]ny applicant for a Federal license or permit to conduct any activity including, but not limited to, the construction or operation of facilities, which may result in any discharge into the navigable waters, shall provide the licensing or permitting agency a certification from the State in which the discharge originates or will originate . . . that any such discharge will comply with the applicable provisions of sections 1311, 1312, 1313, 1316, and 1317 of this title. . . . If the State, interstate agency, or Administrator, as the case may be, fails or refuses to act on a request for certification, within a reasonable period of time (which shall not exceed one year) after receipt of such request, the certification requirements of this subsection shall be waived with respect to such Federal application. No license or permit shall be granted until the certification required by this section has been obtained or has been waived as provided in the preceding sentence. No license or permit shall be granted if certification has been denied by the State, interstate agency, or the Administrator, as the case may be” (
33 USC § 1341 [a] [1] [emphasis added]).
As is evident from the express language of the Clean Water Act, Congress granted to the states project-ending authority. FERC‘s certificate cannot displace federal law and New York State‘s rights of assessment thereunder.
As the above discussion establishes, the FERC certificate issued to the Corporation here is not the culmination of a completed approval process but rather a step in a multi-level review which requires additional approvals in accordance with federal and state laws. This FERC certificate allows the Corporation to seek the required approvals, but it does not give a final green light to the proposed project. Indeed, as the Corporation concedes, it may negotiate and reconfigure the details of the project to acquire the necessary outstanding administrative approvals. That FERC is the “lead agency” but does not complete the actual environmental reviews (see majority op at 302 n 1) confirms that without the additional mandatory assessments or legally effective waivers, the project cannot be realized.
B. EDPL Article 2 Requirements
Individual property rights are a central organizing principle of our legal system, which assiduously protects owners against unwanted interference with their rights of enjoyment and use (see Lynch v Household Finance Corp., 405 US 538, 552 [1972] [“That rights in property are basic civil rights has long been recognized“]; see e.g.
In New York, the EDPL provides the exclusive procedure for acquisition of private property for public use by means of the State‘s eminent domain power and requires the condemnor to demonstrate that the project‘s benefit to the community-at-large outweighs the landowner‘s interests. Specifically, and in accordance with the statutory purpose, a condemnor must satisfy a rigorous review process intended to “give due regard to the need to acquire property for public use as well as the legitimate interests of private property owners, local communities and the quality of the environment, and to that end to promote and facilitate recognition and careful consideration of those interests” (
As set forth in EDPL article 2, a condemnor must hold hearings and make findings that include, but are not limited to,
“(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” (
EDPL 204 [B] ).
A party affected by the findings may challenge them by filing a petition in the Appellate Division “in the judicial department embracing the county wherein the proposed facility is located” (
Under section 206, a condemnor may avoid the section 204 hearing and findings requirement if, inter alia, it has completed a government approval process that requires it to “submit[ ] factors similar to those enumerated in”
“[t]he condemnor shall be exempt from [the hearing and findings requirement of
EDPL 204 ] when: . . .“pursuant to other state, federal, or local law or regulation it considers and submits factors similar to those enumerated in [
EDPL 204 (B) ], to a state, federal or local governmental agency, board or commission before proceeding with the acquisition and obtains a license, a permit, a certificate of public convenience or necessity or other similar approval from such agency, board, or commission.”
Thus, the EDPL conditions avoidance of the hearings and findings requirement on the condemnor‘s acquisition of, among other things, a “certificate“—not, as the majority‘s conclusion allows, what practically and effectively is a conditional certificate.
Essentially, the EDPL permits an alternative process comparable to that set forth in section 204—one that serves the statutory purpose to scrutinize the project to determine whether it justifies the condemnor‘s acquisition of private property through eminent domain. The framework eliminates the cost and burden associated with section 204 hearings when the condemnor has completed a government assessment that provides for similar quantitative and qualitative levels of project review. As a result, a certificate or other permit may or may not satisfy
The Corporation‘s reliance on the FERC certificate to satisfy section 206 is misplaced because, as discussed above, FERC is not authorized to conduct the entire range of environmental impact review required for the project. Congress through the Clean Water Act leaves to New York State part of this task (see
To be sure, not every matter left for future resolution renders a government approval valid for section 206 purposes. For example, post-construction conditions may be irrelevant to whether the public‘s beneficial use is sufficiently compelling to overcome the private interests, or pre-construction conditions may not affect project feasibility or be of the type that would affect a determination regarding factors similar to those listed in section 204. However, where, as here, the FERC certificate is conditioned on New York State‘s federally mandated independent environmental assessment, and that condition is outstanding at the time of filing, the FERC certificate does not satisfy section 206. It bears stating the obvious that, because the condition attends to pollutant discharge into New York‘s waters, it falls squarely within the interests identified in the EDPL‘s statement of purpose and section 204, both of which reference the quality of the environment as a matter that must be considered and addressed by the condemnor. Further, the Clean Water Act assessment conducted by DEC is not a trivial matter or one that has marginal effect on a project. Instead, as the Corporation tacitly concedes, the project cannot move forward without a WQC or a valid waiver of the WQC process.
The majority‘s conclusion that the section 206 alternative process strips the court of its authority to consider whether the condemnor has satisfied the requirements of article 2—or, in the words of the majority, it “neither requires nor authorizes . . . courts to inquire . . . into the likelihood that a project will be completed based on . . . pending conditions or permit applications” (majority op at 310)—ignores the simple fact that the relevant part of section 206 renders compliance with section 204 unnecessary only if the condemnor “considers and submits factors similar to those enumerated in” section 204 (
Rather than limit the holding on this appeal to the narrow question before us—namely whether this specific FERC certificate, issued for this unique gas pipeline project, satisfies the EDPL—the majority unnecessarily and without legal support cabins the power of judicial review to reach the sweeping conclusion that any government document, regardless of content, restrictions and limited scope of approval, absolves the condemnor of the requirements of section 204. If the mere issuance of any government approval document is sufficient on its face to meet the statutory demands of article 2, the Corporation could acquire title to the Schueckler land by merely acquiring a local permit unrelated to the environmental impact of the project. That would conflict with the legislature‘s intent that environmental matters be given due consideration before private property may be acquired for public use (see
The majority disputes my characterization of the effect of its approach, but does so by doing exactly what it repudiates, namely, inquiring into FERC‘s review of the Corporation‘s submissions to determine whether FERC adequately considered the
Aside from the fact that the majority‘s reading undermines the purpose of the EDPL by allowing for involuntary transfer of title without complete vetting of the issues that underlie the public use analysis, the majority ignores the plain language of section 206, and in so doing violates canons of construction that we must give meaning to all the words chosen by the legislature and interpret a statute to achieve its legislative goals (see Golden v Koch, 49 NY2d 690, 694 [1980] [stating that under “traditionally accepted standards of statutory construction,” courts must “read (a statute) as a whole” and consider “each word“]; McKinney‘s Cons Laws of NY, Book 1, Statutes §§ 97, 98). If, as the majority concludes, courts have no judicial role other than to confirm the existence of a government document approving something—anything—then the legislature would have no reason to include the circumscribing language that the nonexhaustive list of section 204 (B) factors must be “consider[ed] and submit[ted],” leading to the government entity‘s approval (
The majority‘s analysis, taken to its logical end, would mean that the Corporation—or any party who obtains a document that, no matter its contents or conclusions, is denominated “certificate” from a single agency for a private commercial enterprise—could condemn private property and vest title in itself, even without all the necessary government approvals and even if the project is subsequently disapproved and never completed. The “book to be judged by its cover” in these situations, according to the majority, is the government administrative document titled a certificate.
To support its unsupportable conclusion, the majority emphasizes that in issuing the certificate, FERC did not place restrictions upon the Corporation‘s ability to exercise eminent domain under the NGA. That is true, and as a result, the Corporation became the unusual type of private entity which could use New York‘s eminent domain procedures to seize privately owned land.6 This fact, however, does not bear at all under the EDPL as written on whether the Corporation actually complied with those procedures. In other words, the NGA clearly does not give the Corporation greater status with respect to exercise of eminent domain than a municipality or the State itself. In any case, the record does not reveal any reason why the timing of eminent domain, as distinct from the authority to exercise eminent domain, would be relevant for FERC‘s administrative review purposes; it is patently nonsensical to expect the FERC certificate to address every element of eminent domain procedure.7 In sum, by creating from whole cloth an apparent rule that any “certificate of public convenience and necessity” satisfies
The majority‘s reliance on a different section of the EDPL to shore up its construction of article 2 is misplaced. The majority argues that because section 406 grants an owner the right to repurchase property should the project be abandoned, we must read the EDPL as allowing involuntary title transfers for projects that may eventually fail. That position misses the mark. First, it is unclear that failure to acquire the necessary approvals constitutes “abandonment” of a project for purposes of the EDPL. For example, the project could be redesigned and go forward without the need to condemn the owner‘s property. Second, the property buy-back allowed by section 406 applies only if condemnation was properly exercised, meaning section 406 provides a limited remedy to an owner where the public use initially justified acquisition of the property, but the condemnor subsequently deserts the project. Here, the Corporation failed to satisfy the requirements of EDPL article 2: the Corporation did not hold hearings and make findings in accordance with section 204, nor does the FERC certificate comply with section 206. The limited remedy of section 406 is simply irrelevant on these facts. Third, the remedy has limited impact and works best for those who are able financially to buy back their land and interested in doing so no matter the changes to the landscape, years after having title taken away. For example, if the Corporation “abandons” the project after gaining title, clear-cutting the land and commencing construction (and after all, the point of vesting title now is to move forward with construction; otherwise why the rush to the courthouse?) there is no certainty that respondent Theresa Schueckler—now widowed—would have the funds to repurchase that property, even if she wanted it in its changed condition.
And that brings me to a point unaddressed by the majority. The Corporation concedes, and FERC anticipates, that the project‘s details may go through further revision in order to accommodate and address pre-construction problems. It may be that after taking title, and clear-cutting the Schueckler property, the Corporation modifies its plans, perhaps rendering use of the disputed land unnecessary or requiring an easement to another swath in a different location. Given this uncertainty, and the potential for project redesign that affects the public use justification for taking a designated area of land in the first place, it is nonsensical and unfair to take the Schueckler property before completing the necessary state permit process and ensuring that the project will likely move ahead in a form approved by New York.
The majority‘s concern that adherence to the command of the EDPL is unworkable and involves impermissible scrutiny of federal agencies’ “public use review and findings” (see majority op at 310) is not borne out by the statute or review of this FERC certificate. No “extensive,” costly, and time-consuming state scrutiny is required (id.). All that need be done here is to read the Clean Water Act provision and the condition contained in appendix B to the FERC certificate, and compare them to the language of the EDPL. Notwithstanding the majority‘s disclaimer, it has in fact looked in all the wrong places to determine compliance with the EDPL, focusing on what FERC did but not what it could not and did not do.
A majority of this Court has spoken, and it is now for the legislature to consider whether legislation is necessary to protect owners like the Schuecklers. It would not be the first time the legislature has stepped in after courts have broadly applied the power of eminent domain to divest private owners of their land for a private use with uncertain or unrealized public benefits (see e.g. Kelo v New London, 545 US 469, 483 [2005] [holding that city could seize homes for private redevelopment project to serve “economic development” purpose]; Patrick McGeehan, Pfizer to Leave City That Won Land-Use Case, NY Times, Nov. 13, 2009, § A at 1 [discussing aftermath of the Kelo decision, in which the company for which the land was obtained subsequently abandoned the project “as a cost-cutting measure“]; see also Matter of Uptown Holdings, LLC v City of New York, 77 AD3d 434 [1st Dept 2010] [holding that non-blighted area could be seized for economic development purposes notwithstanding lack of protections such as development plan to which developer would be bound]). The United States Supreme Court decision in Kelo v New London is perhaps the most infamous; it resulted in a flood of state legislation to prohibit the economic development grounds approved by the Court, as well as decisions by various states’ high courts rejecting its rationale on state constitutional grounds (see e.g. Reading Area Water Auth. v Schuylkill Riv. Greenway Assn., 627 Pa 357, 375, 100 A3d 572, 583 [2014] [holding, under Pennsylvania statute passed in the wake of Kelo, that private use with incidental public benefits could not support eminent domain proceedings]; Norwood v Horney, 110 Ohio St 3d 353, 377, 853 NE2d 1115, 1141 [2006] [adopting Kelo dissenters’ analysis]; John M. Broder, States Curbing Right to Seize Private Homes, NY Times, Feb. 21, 2006, § A at 1 [“lawmakers in virtually every statehouse across the country are advancing bills and constitutional amendments to limit use of the government‘s power of eminent domain” in Kelo-type circumstances “in direct response to” the Supreme Court decision]; see also Charles E. Cohen, Eminent Domain after Kelo v.
III. Judicial Notice
In the alternative, the Corporation argues that even if an incomplete WQC process is grounds for denying vesting of title, that is no barrier to the proceeding here. The Corporation reasons that because FERC has now determined that DEC‘s denial of the WQC is untimely and thus New York waived its rights under the Clean Water Act, this Court should consider the FERC certificate as satisfying EDPL 206. It further claims that the Appellate Division erred when it failed to take judicial notice of the FERC decision as it should have concluded that “FERC‘s waiver order removed the obstacle” to exercise of eminent domain through the
The procedural history is more complex and less favorable to the Corporation than its argument suggests. As DEC‘s denial letter recites, the Corporation initially agreed with DEC “that, for the purposes of review under Section 401 of the CWA, the Joint Application was deemed received by NYSDEC on April 8, 2016, ‘[t]hereby extending the date [by which] the NYSDEC has to make a final determination on the application until April 7, 2017.’ ” DEC issued its decision prior to the agreed extended date. When DEC issued a decision unfavorable to the Corporation, however, the Corporation collaterally attacked the WQC denial by seeking a waiver order from FERC, on the basis that the parties could not agree to extend the date, and so, notwithstanding the parties’ agreement, DEC exceeded the permissible time frame for its Clean Water Act review. FERC agreed with the Corporation and denied a stay of its order, and an appeal of that order is now pending before the Second Circuit. Separately, the Second Circuit vacated DEC‘s order, stating that although it was a “close case,” DEC “did not sufficiently articulate the basis for its conclusions,” and remanded so that DEC could “more clearly articulate its basis for the denial” (National Fuel Gas Supply Corp. v New York State Dept. of Envtl. Conservation, 761 Fed Appx 68, 70-72 [2019]). DEC thereafter reissued its denial, elaborating upon its reasoning.
Courts may take judicial notice of facts that amount to common knowledge or may be determined “by resort to easily accessible sources of indisputable accuracy” (Hamilton v Miller, 23 NY3d 592, 603 [2014], quoting People v Jones, 73 NY2d 427, 431 [1989]). Whether to take judicial notice of such a fact is within the discretion of the trial court (see Hunter v New York, Ontario & W. R.R. Co., 116 NY 615, 621 [1889]; Matter of Crater Club v Adirondack Park Agency, 86 AD2d 714, 715 [3d Dept 1982], affd for reasons stated below 57 NY2d 990 [1982]; Sleasman v Sherwood, 212 AD2d 868, 870 [3d Dept 1995]). Courts decide whether to take judicial notice of a fact “depend[ing] on the nature of the subject, the issue involved and the apparent justice of the case” (Hunter, 116 NY at 621; see Walker v City of New York, 46 AD3d 278, 282 [1st Dept 2007]). While our state courts are required to take judicial notice of positive law so that they can resolve cases under those laws (see
Notably, the Corporation argues for judicial notice of only part of the events that have transpired in this and parallel litigation. It requests that the courts recognize that FERC has rejected the timeliness of the WQC, but not the existence of pending judicial challenges to FERC‘s determinations and the possibility that the federal courts may hold that DEC‘s denial of the WQC is valid. It is not farfetched that the federal courts may side with New York, given the Corporation‘s agreement with DEC, as well as the fact that the Corporation could have simply reapplied for the WQC to restart the one-year statutory clock after signing off on the agreement. The Corporation chose not to, instead arguing before FERC and the Federal Circuit Courts that DEC‘s denial was untimely issued and should be ignored.8 Although convenient, this may not be a winning argument, and in any case that uncertainty is a valid basis to decide
IV. Conclusion
Not to be lost in the legal analysis is the practical effect of the majority‘s ruling. The first page of the FERC certificate establishes the conditional nature of FERC‘s authorization. One of the conditions that would stop progress on the pipeline is the failure to establish compliance with “all applicable authorizations required under federal law.” Absent proof of receipt of those authorizations, there could be no pipeline, and absent an ability on the part of the condemnor to build the structure that the taking here is intended to accommodate, the courts should not sanction acquisition of the Schueckler property.
It is undisputed that the FERC certificate issued to the Corporation is conditioned on New York State‘s rights under the Clean Water Act, including the right to deny the Corporation a WQC, preventing construction and derailing the proposed gas pipeline. Given the nature of the project, and the threat of environmental damage from the pipeline‘s construction and operation, the WQC process is vitally important. The proposed pipeline would traverse approximately 97 miles in four Western New York counties, including rural communities that would be affected by the project as planned. The path drawn for the pipeline crosses no fewer than 192 state-regulated streams and impacts over 73 acres of federal and state wetlands.9
Notwithstanding the vital environmental interests, the majority‘s reading of the FERC certificate and our procedural law permits the acquisition of private property absent approvals ensuring that those wetlands and waterways—some of which drain into the Great Lakes—would be protected during and after construction of the proposed pipeline. The law does not mandate such a result. Instead, federal and New York laws and regulations guard against environmentally impactive pollutant discharges associated with the pipeline project (see
Nor does the law support the outcome here in which, based on the title of a FERC certificate, the property interest of a lone private individual—respondent Theresa F. Schueckler—is extinguished in furtherance of private economic interests that may never be realized. The courts should not sanction this involuntary transfer of title with its attendant harm to the owner. Theresa F. Schueckler should retain her right to use and dispose of her property freely absent an adequate showing justifying divesting her of title. A showing the corporation has not made as required by the EDPL.
For the foregoing reasons I dissent.
Chief Judge DiFiore and Judges Wilson and Feinman concur; Judge Rivera dissents and votes to affirm in an opinion, in which Judge Fahey concurs; Judge Garcia taking no part.
Order reversed, with costs, and order of Supreme Court, Allegany County, reinstated.