54 Misc. 2d 1057 | N.Y. Sup. Ct. | 1967
The defendant moves, pursuant to CPLB 3211 (subd. [a]), before answer, to dismiss the complaint herein upon the grounds that this court is without jurisdiction of the action and that the plaintiff does not have legal capacity to sue.
The action is for a judgment declaring the rights of the parties respecting liability for interest upon funds appropriated by the State to the Superintendent of Public Works for the construction of the Thruway, a public highway (Highway Law, art. 12-A; “ the New York state section of a national network of Blue Star memorial highways ”, § 346-a).
The matter of plaintiff’s liability is embraced, the defendant contends, within the provisions of subdivision 2 of section 357
The plaintiff believes it is compelled to take the initiative in bringing the matter to a head because of precautionary advice received from bond counsel respecting possible legal liability for the payment of interest. It is for the benefit of the State that plaintiff’s bonds should continue to enjoy a high rating, for the public sale of' such bonds is the direct and immediate means by which the capital construction fund of the State will obtain the refund of the cost of constructing the Thruway. The State’s interest in this respect is evidenced in section 6 of article X of the New York Constitution. The use of the declaratory judgment is necessary in this case to settle a dispute involving the meaning or application of a statute. The defendant has failed to take action which would dispose of the issue, and so long as it remains unresolved, a possible unprovided for and unascertainable liability, involving millions of dollars hangs suspended over the marketability in the future of the plaintiff’s bonds (see Town of Ohio v. People, 264 App. Div. 220; New York Operators v. State Liq. Auth., 285 N. Y. 272; Bunis v. Conway, 17 A D 2d 207, mot. for lv. to app. dsmd., 12 N Y 2d 882, app. dsmd. 13 N Y 2d 1143). The plaintiff has the necessary power to institute and maintain the action (Public Authorities Law, § 354; see Matter of Plumbing Assn. v. New York State Thruway Auth., 5 N Y 2d 420). The attack upon the complaint for insufficiency brings into play the familiar rule that the pleading is to be liberally construed and the facts alleged and the inferences that may be fairly drawn are deemed admitted (CPLR 3026; St. Regis Tribe v. State of New York, 5 N Y 2d 24).
The inability of the parties to agree is reminiscent of the difficulties they experienced in arriving at a dollar settlement of the unliquidated sum contemplated by the “ definite policy as early as 1952, or perhaps earlier, that the Thruway should only assume costs for construction that inured solely for the benefit of the Thruway, and not for the construction costs for work that inured to benefit of the State highway system, or other State facilities ” (New York State Thruway v. State of New York, 50 Misc. 2d 957, 962 (Foster, J.), affd. 28 A D 2d 607). The parties’ agreement of February 27, 1963, is expressive of
On several occasions, over a period of years, and while the parties (including their predecessor representatives) were attempting to perfect the agreement contemplated by subdivision 2 of section 357 of the Public Authorities Law, there was discussed the question of the payment of interest on the appropriations. These culminated in the agreement of March 1, 1965. Therein it is recognized that a bona fide question existed which the parties agreed ought to be finally settled by a submission on an agreed state of facts. An agreement on the facts was not forthcoming. It is accepted, therefore, that any prior agreements by the plaintiff to pay interest have been superseded by the agreement of March 1, 1965.
While the statute last cited refers to the amount as a debt, it is to be understood, in accordance with the facts, that the term is used in a bookkeeping sense and not as representing a sum loaned with an obligation to repay. The principal amount was not, as Judge Foster found, “ advanced directly as a loan to the Authority but appropriated to the Department of Public Works * * * Any expenditures from the appropriation were to be repaid to the State in the manner provided by subdivision 2 of section 357 of the Public Authorities Law ” (Thru