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Court of Appeals Upholds Privatization of Interior Landmark
The New York City Landmarks Preservation Law authorizes the Landmarks Preservation Commission (LPC) to designate interior landmarks as well as exterior landmarks. An interior site is eligible for designation only if the public has access to the site, but once the LPC has designated the interior landmark, can the LPC authorize its owner to close the landmark to public access? In Save America's Clocks, Inc. v. City of New York, NYLJ 3/29/19, p. 25., col. 1., a divided Court of Appeals answered "yes."
|The Landmarks Law
In 1973, an amendment to the Landmarks Preservation Law authorized the LPC to designate as an interior landmark "[a]n interior, or part thereof, any part of which is thirty years old or older, and which is customarily open or accessible to the public, or to which the public is customarily invited, and which has a special historical or aesthetic interest or value." (New York City Administrative Code, section 25-302[m]).
|The Designation and the Application
In 1987, the LPC designated 346 Broadway, a building designed by McKim, Mead & White and completed in the 1890s, as a landmark. The LPC designated some of the building's features as interior landmarks. In particular, the LPC designated the clock tower, a large mechanical clock driven by a 1,000 pound weight which strikes the hours with a hammer and a 5,000 pound bell. In total, the LPC landmarked 20,000 square feet out of the building's total interior space of 420,000 square feet. At the time of the designation, the City of New York owned the building, but the city sold the building to a private developer in 2013. The developer sought to convert the building into private residences, one of which would encompass the clock tower.
In 2014, the developer sought a certificate of appropriateness for a conversion that would incorporate the clock tower into a private residence, and would transform its mechanism so that it would operate electrically rather than mechanically. During the hearing on the developer's application, the LPC's General Counsel opined that the Landmarks Law did not give the LPC power to require interior-designated spaces to remain public, and also opined that the LPC lacked power to require that the clock remain operative. After the hearing, the LPC, by a vote of 7-1, approved the developer's proposal.
|Litigation
A historic preservation group, joined by other individual and institutional petitioners, then brought this article 78 proceeding challenging the determination. Supreme Court granted the petition, concluding that the decision to eliminate public access to the clock tower was irrational and arbitrary. Supreme Court concluded that the decision approving electrification of the clock was rational, but was invalid because it was the product, at least in part, of the General Counsel's incorrect advice that the LPC could not regulate the functioning of the clock. A divided Appellate Division affirmed, concluding that both of the LPC's decisions were irrational, and that both were affected by the General Counsel's advice. The city and the developer appealed.
The Court of Appeals reversed. In an opinion by Judge Michael Garcia, the 4-2 majority rejected the position that the LPC must maintain public access to any interior landmark. The majority concluded that public access is a jurisdictional predicate for initial designation as an interior landmark, but agreed with the LPC's position that "public access is a threshold condition, not an ongoing one." Once the majority disposed of the argument that the LPC lacked authority to limit public access, the court focused on the deferential standard of review applicable to LPC determinations, and concluded that both of the LPC's determinations were rational. In particular, the majority concluded that modernization of the clock by electrification would assure continued maintenance for the foreseeable future. Finally, the majority rejected the argument that the LPC's determination was affected by an error of law (presumably, the erroneous advice of its General Counsel). The majority noted that the certificate of appropriateness set forth the reasons for the LPC's actions, and concluded that because those reasons were rational, there was no need to speculate about how the LPC reached its decisions.
Judge Jenny Rivera, dissenting for herself and Judge Rowan Wilson, argued that the LPC's decisions were "in direct contravention of the Landmarks Preservation Law's statutory proposes and public policy: the preservation of unique structures and spaces that reflect the City's aesthetic, cultural, and historic values for everyone's enjoyment." Judge Rivera argued that the LPC had no authority to grant a certificate of appropriateness for conversion of the clock tower into a private apartment, and she concluded that both of the LPC's determinations — allowing electrification of the clock and privatization of the space — were erroneous as a matter of law.
*****
Stewart E. Sterk, Mack Professor of Law at Benjamin Cardozo School of Law, is the Editor-in-Chief of New York Real Estate Law Reporter.
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