94 N.Y.2d 154 (1999).
November 18, 1999
(99 NY Int. 0149)
Decided November 18, 1999
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This opinion is uncorrected and subject to revision before publication
in the New York Reports.
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KAYE, CHIEF JUDGE:
KAYE, CHIEF JUDGE:
Is the prejudgment interest rate on property condemned by the
Metropolitan Transportation Authority ("MTA") nine percent(as provided
by Unconsolidated Laws § 2501) or four percent (as provided by
Public Authorities Law § 1276(5))? The courts below answered nine
percent, as do we.
In June 1988, the MTA condemned certain easements across American
Pen's property in order to construct a roadway accessing an electric
substation. In accordance with Eminent Domain Procedure Law article 3,
the MTA appraised the property at $230,000 before the taking and
$110,000 afterward, and offered American Pen $120,000, the amount it
viewed as just compensation. American Pen rejected the offer. After
the parties failed to reach agreement, the MTA acquired title to the
easements pursuant to court order, and in April 1992 made a payment of
$120,000 plus $35,619.29, representing nine percent interest "from
title vesting date to the date of payment."
American Pen then filed a claim against the MTA, alleging that the
taking resulted in damages totaling $1,323,000. According to American
Pen, the full value of its property was $1,350,000, and the
post-condemnation value was only $27,000. Supreme Court, after a bench
trial, accepted American Pen's valuation of the property, concluded
that the taking reduced the value by 40 percent, and ordered that the
MTA pay an additional $420,000 plus interest. When American Pen sought
nine percent interest in its proposed judgment, the MTA countered that
the applicable rate was four percent based on Public Authorities
Law § 1276(5). Supreme Court held that the MTA, as a
publiccorporation, was "bound by the 9% rate of interest" and ordered
payment of nine percent prejudgment as well as postjudgment interest
on the award.
SNIPPETS:
KAYE, CHIEF JUDGE:
Is the prejudgment interest rate on property condemned by the Metropolitan Transportation
the MTA condemned certain easements across American Pen's property in order to construct a
In accordance with Eminent Domain Procedure Law article 3, the MTA appraised the property at
After the parties failed to reach agreement, the MTA acquired title to the easements pursuant
Supreme Court, after a bench trial, accepted American Pen's valuation of the property,
When American Pen sought nine percent interest in its proposed judgment, the MTA countered
Supreme Court held that the MTA, as a publiccorporation, was "bound by the 9% rate of
After the MTA filed its notice of appeal, however, the parties settled the case for $400,000,
In February 1998 -- almost a decade after the taking --the MTA paid American Pen $280,000,
The court concluded that because Unconsolidated Laws § 2501 authorized nine percent interest
As to postjudgment interest, however, the Appellate Division opted for the four percent rate
The MTA appealed Supreme Court's judgment directly to this Court, bringing up for review the
To ensure that a condemnee obtains just compensation, the State is constitutionally required
"The amount of interest necessary to bring the payment into accord with the constitutional
we examine the question of which statutory interest rate applies in this condemnation
Unconsolidated Laws § 2501 states that the "rate of interest to be paid by a public
Public Authorities Law § 1276 is a consent to suit provision authorizing suit against the MTA.
Indeed, it is not Public Authorities Law § 1276 but the New York State Constitution that
The State and its agencies are never immune from claims arising out of the exercise of their
(Mem of Senate Sponsor Albert B. Lewis, Bill Jacket, L 1969, ch 1102; see also, L 1966, ch
Parity in the State rate and the rate generally applicable to its public corporations would
d palpably improper" because, among other reasons, "the Constitution guarantees the same measure of
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