In New York: Public Trust Doctrine Thwarts Retail Mall

In 2011, the City of New York issued a request for proposals for the development of Willets Point. Queens Development Group (QDG) submitted a proposal that included retail space, a hotel, outdoor space, a public school, affordable housing, and a large-scale retail complex. QDG proposed to locate the retail complex on the Shea Stadium site, called “Willets West.” QDG planned to develop in phases, the first of which would include Willets West. A later phase, to begin in 2026, would include construction of 2,490 housing units, 35% of which would be affordable. By the terms of an agreement with the City's Economic Development Corporation, QDG could buy its way out of the later phase by paying $35 million. The city approved QDG's proposal in May 2012.

State Senator Tony Avella and others then brought an article 78 proceeding challenging the approval on the ground that the public trust doctrine required legislative approval of the use of parkland for Willets West. The trial court denied the petition and dismissed the proceeding, but a unanimous Appellate Division reversed, declaring that construction of Willets West on city parkland violated the public trust doctrine, and enjoining any further steps toward construction. QDG appealed.

The Court of Appeals Opinion

The Court of Appeals, New York's highest court, affirmed in an opinion authored by Judge Rowan Wilson. The court started by reciting the general principle that even if a municipality owns parkland, the title is held in trust for the public, and the power to regulate its uses is vested in the state legislature. The court then turned to the 1961 legislation concerning Shea Stadium, and concluded that the legislation authorized use of parkland for a stadium, but not for other commercial purposes.

The court noted that section 18-118 of the City's Administrative Code was titled “Renting of a Stadium in Flushing Meadow Park,” and focused on subdivision (a), which authorized the city to “enter into contracts, leases or rental agreements with, or grant licenses, permits, concessions or other authorizations” so that a person or persons acquires the right to “use, occupy or carry on activities in, the whole or any part of a stadium, with appurtenant grounds, parking areas and other facilities … ” The court's majority acknowledged that the subdivision: 1) also authorized the city, after expiration of any such agreements, to enter into any agreements for any of the purposes specified in subdivision 2) of the section, and conceded that subdivision 3) enumerates “ improvement of trade and commerce” as one of the statutory purposes. But the court concluded that a broad reading of the statute would make much of the statutory language superfluous, because virtually any use of the property could be read as designed to improve trade and commerce.

The Dissent

Chief Judge Janet DiFiore, the court's lone dissenter, argued that the majority's construction of the legislation was overly narrow. She contended that the majority opinion accorded undue weight to the statute's title, and too little to the “broad, flexible, and expansive language” in the statute. She also noted that stadium projects today often include malls or retail centers “to provide avenues for commerce and recreation that complement stadium attractions.” In her view, the legislature “specifically allowed for this eventuality when it enacted the statute.”

The Implications

The court's Avella opinion has implications both for litigators and for drafters of legislation. For litigators, the message is that legislative authorization of one commercial use does not necessarily include other commercial uses. As a result, both municipal lawyers and project opponents must carefully parse statutory language.

For drafters, the message is that too much specification can create problems for the future. What the drafters of the 1961 legislation intended remains uncertain, but the language they used did not avoid litigation half a century later.

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Stewart E. Sterk is Mack Professor of Law at Benjamin Cardozo School of Law and the Editor-in-Chief of the New York Real Estate Law Reporter.