127 N.Y.S. 858 | N.Y. App. Div. | 1911
Lead Opinion
The New York and Long Island Railroad Company was duly incorporated on or about the 30th day of July, 1887, and duly acquired the consent of the board of aldermen of -the then city of New York for the construction, operation and maintenance of a' tunnel railroad in, through and under the surface of Forty-second street from its easterly end to a point therein between Tenth and Eleventh avenues in said city, and such tunnel has been actually constructed from the easterly end of Forty-second street to a point at or near its intersection with Park avenue. The tunnel extends beneath the bed of the East river to certain designated points in Long Island City.
The time of the railroad company to complete • the construction of its railroad was extended by various acts of the Legislature until the 1st of January, 1907 (Laws of 1903, chap. 597), when, by reason of the failure of the company to complete its road, its corporate existence expired in accordance with the provisions of section 5 of the Railroad Law (Gen. Laws, chap. 39 [Laws of 1890, chap. 565]; as amd. by Laws of 1901, chap. 508; since amd. by Laws of 1910, chap. 478), which is now section 12 of the Railroad Law (Consol. Laws, chap. 49; Laws of 1910, chap. 481), and all its property, franchises and rights became vested in the individuals who were on that date its directors, as trustees, for the 'benefit of stockholders and creditors of the corporation in accordance with the provisions of section 30 of the General Corporation Law (Gen. Laws, chap. 35 ; Laws of 1892, chap. 687), which is now section 35 of the General Corporation Law (Consol. Laws, chap. 23 ; Laws of 1909, chap. 28). The relators were on the 1st of January, 1907, the directors of said company, and.they became the trustees of its property under the statutory provisions referred to.
The geographical limits of the borough of Manhattan extend to the bulkhead line of the Queens county shore, thus including the bed of the East river. The State Board of Tax Commissioners levied an assessment of $3,175,000 'up'ón the special franchises of the relators in the borough of Manhattan, city of New York, for the year 190.8, and of $3,350,000 upon said franchises for the year 1909, which assessments having been affirmed upon certiorari proceedings by the Special Term (People ex rel. Bryan v. State Tax
It was stipulated between counsel that if the court should hold that the entiré tunnel in the borough of Manhattan was properly assessable by the State Board of Tax Commissioners as a special franchise, then the existing assessments for 1908 and 1909 -respectively might be regarded as the. equalized valuations thereof for the purpose of taxation. Therefore, the sole '.point presented to this court is whether so much of the tunnel beneath the bed of the river as extends from a point 300 feet east of the bulkhead line of the Manhattan shore to the bulkhead line of the Queens shore, is legally subject to taxation.
On the 5th of January, 1891,' a patent was issued by the State to the company reading as follows : “ Know ye, that pursuant to. Chapter Í40, Laws of 1850, as amended by Chapter 601, Laws of 1886, and a resolution of the Commissioners of the Land Office adopted November 25,1890, we have given and granted, and by these Presents do give and grant unto The New York and Long Island Railroad Company, its successors and assigns, a right of way ninety-nine feet in. width and fifty feet in height,, within which to construct a tunnel for the use and operation of above named grantees’ railroad beneath the waters of the East River, upon and along the route' of said railroad between the City of New York and Hiinterls Point in Long Island City, as-shown in plan and profile, upon the charts filed in the office of our Seóretary of State, with the water grant papers of the month of January, 1891. Together with all and singular the rights, hereditaments and appurtenances to the same belonging or in any wise appertaining; to have and to hold the above described premises unto fhe said The New York and Long Island Railroad Company, its successors and assigns forever.” The consideration paid by the New York and Long Island Railroad Company for such grant was $575.
The relators contend that the portion of their tunnel under the river between the points above- indicated is built entirely within their own property, and, therefore, is not subject to an assessment such,as is under review here; in other words, that the patent is an absolute conveyance of real estate.
Subdivision 3 of section 2 of the Tax Law (Gen. Laws, chap. 24 Laws of 1896, chap. 908], as amd. by Laws of 1899, chap. 712 ;
It seems to us that thé contention of the relators is unsound. The intention of the Legislature in providing this source of revenue was to subject to taxation those making use of public property in the prosecution of their business. If a railroad be located in, upon or under a public street, in accordance with the necessary permission granted by the proper authorities, it has a property right within the usual and common signification of that word as held'in People v. O'Brien (111 N. Y. 1). The court said : “ The title to streets in New York is vested in the city in trust for the People of the State, but under the Constitution and statutes it had authority to convey such title as was necessary for the purpose, to corporations desiring to acquire the same for use as a street railroad. * * * Grants similar in all material respects to the one in question have heretofore been before the courts of this State for construction, and it has been quite, uniformly held that they vest the grantee with an interest in the street in perpetuity, for the purposes of a street railroad.”
The land under water in the East river is held by the State. The Court of Appeals said, in Matter of City of New York (168 N. Y. 134): “The State holds the title in fee in the tideway and to the lands under water beyond the samé, as trustees for the public in its organized capacity.” It lias granted through this land so liéld in
Relators’ road is situated under public waters, and, therefore, comes within the express terms of the Tax Law cited. We have no doubt that the tunnel under the river was properly taken into consideration by the board in assessing the special franchise of relators for purposes of taxation, and it follows, therefore, that the orders appealed from should be affirmed, with costs and disbursements to the respondent.
Ingraham, P. J., Scott and Miller, JJ., concurred ; Laughlin, J., dissented.
Dissenting Opinion
The State Board of Tax Commissioners fixed the valuation of special franchises of the relator in the borough of Manhattan, New York, as $3,175,000 for the purposes of taxation .for the year 1908, and as $3,350,000 for like purposes for the year 1909, and this proceeding has been instituted to review those assessments. Both assessments were affirmed as made at Special Term. One special franchise included in the assessments was granted to the New York • and Long Island Railroad Company by the board of aldermen of the city of New York on the 23d day of December, 1890, and approved by the mayor on the thirty-first day of the same month. It conferred the right to construct a" tunnel under the surface of Forty-second street from the East river westerly to a point between Tenth and Eleventh avenues for a double-track railroad in accordance with plans and a profile theretofore presented to said board.
Another alleged special franchise included in the assessments is a right of way and tunnel for the use and., operation of the railroad constructed under the East river, from the easterly end of Forty-second streét to the bulkhead line of the shore of Queens county, that being the boundary line of the borough of Manhattan.. This right of way was granted by and the tunnel was constructed under letters patent from the State duly granted on the 5th day of Janu
“ Together with all and singular the rights, hereditaments and appurtenances to the same belonging or in any wise appertaining; to have and to hold the above described premises unto the said The New York and Long Island Railroad Company, its successors and assigns forever.”
The question presented by the appeal is whether the right of way, tunnel and railroad constructed therein under the letters patent constitute a special franchise within the provisions of section 2 of the Tax Law (Gen. Laws, chap. 24 [Laws of 1896, chap. 908], as amd. by Laws of 1899, chap. 712; revised by Consol. Laws, chap. 60 ; Laws of 1909, chap. 62), which, so far as material to the question presented for review, are as follows:
“ 3. The terms ‘ land,’ real estate,’ and ‘real property,’ as used in this chapter, include the land itself above and under water, all buildings and other articles and'structures, substructures and superstructures, erected' upon, under or above, or affixed to the same; * * * all surface, underground or elevated railroads, including the value of all franchises, rights or permission to construct, maintain or operate the same in, under, above, on or through, streets, highways or public places; all railroad structures, substructures v and superstructures, tracks and the iron thereon; branches, switches and other fixtures permitted or authorized to be made, laid or
The parties- have stipulated the equalized valuation of the assessable special franchises of the relators for the years 1908 and 1909 in the event that it is decided that the right of-way, tunnel and railroad constructed under the letters patent are assessable as . a special franchise. They have also stipulated the value of the tangible property constructed under the grant from the board of aldermen for those years; but they have not stipulated the value of the intangible franchise granted by the board of aldermen in connection with the tangible property, and, therefore, if it be decided that the right of way, tunnel and railroad constructed under the letters patent cure not assessable as a special franchise, the matter will necessarily have to be remitted to the Special Term for further proceedings.
I am of opinion that the right of way,- tunnel and- railroad constructed under the letters patent are not a special franchise within the contemplation of the provisions of section 2 of the Tax Law herein quoted.
By the common law of England the title to land under the public navigable waters was vested- in the Crown, and it was regarded as jus privatum and was alienable .by the Grown subject to--the dominion' and control of Parliament over the land and water in the interests of navigation and commerce which was deemed jus publicum; and the State of New York succeeded to all the rights, of both the Grown and Parliament, subject to. the authority.delegated to Congress by the- Federal Constitution, to regulate, and control .- navigation in the' interests of commerce With foreign nations and between the States. (Langdon v. Mayor, etc., N. Y. 129, 154 et seq.; Illinois Central Railroad v. Illinois, 146 U. S. 387; Saunders v. N. Y. C. & H. R. R. R. Co., 144 N. Y. 75.) It was
The franchise which the railroad acquired by its charter and' by filing the maps and profiles of its route gave it, so far as.- concerned the public, a license to construct and operate its Railroad on the route in question along or over the public lands <' of the State; and it could have crossed the East river without obtaining the consent even of the Commissioners of the Land Office. (Railroad Law of 1890, § 4, subd. 4, §§ 6, 11, 16, as amd. by Laws of 1892, chap. 676, and Laws of 1893, chap. 316; Railroad Law of 1910, § 8, subd. 4, §§ 16, 21, 28; New York Central & H. R. R. R. Co. v. Aldridge, supra) With respect to those portions of this route which were upon, over and under public streets, highways and places under the jurisdiction and control of local authorities, its franchise was not complete without the consent of such local authorities which was required by the Legislature (Railroad Law of 1890, §§ 11, 16, as amd. by Laws of 1893, chap. 316; Railroad Law of 1910, §§ 21, 28); but with respect to the private lands of the State, not in use for public purposes, it needed no further franchise from the State (New York Central & H. R. R. R. Co. v. Aldridge, supra), and the Land Board was not authorized to grant it afranchise. If the lands under the river had been previously conveyed by the State and were owned by individual owners of the upland, the relator might have acquired the same by private grant or by condemnation, and in such case it could not be maintained that it thus acquired a franchise of any nature. Moreover, the Commissioners of the Land Office were only authorized tó represent the State with respect to its proprietary ownership of lands and were not clothed with .any ,of the sovereign power to grant franchises.
(See People ex rel. Retsof Mining Co. v. Priest, 75 App. Div.
I am of opinion, therefore, that the right of way and the tunnel and railroad constructed therein pursuant to' the patent from the State did not constitute a special franchise, and are not taxable by the State Board of Tax Commissioners, but by the commissioners of taxes and assessments of the city of ííew York as ordinary real property held and used by a railroad company for the purposes of its incorporation, as before the enactment of the Special Franchise Tax Law. (Tax Law of 1896, § 2, subd. 3, §§ 3, 9, 47, as amd. by Laws of 1899, chap. 712, and Laws of 1902, chap. 171; Tax Law of 1909, § 2, subd. 3, §§ 3, 9, 49; Buffalo & State Line R. R. Co. v. Supervisors of Erie County, 48 N. Y. 93.)
I, therefore, vote to reverse the order and to remit the proceeding to the Special Term for a further hearing.
Order affirmed, with costs and disbursements.
