Rochester Telephone Corp. v. Village of Fairport

OPINION OF THE COURT Simons, J. P. In 1977 defendant Village of Fairport, undertook a Federally funded program to reconstruct and relocate West Church Street and the related water and sewer lines, sidewalks and landscaping. In connection with the project it ordered plaintiff to underground its transmission facilities for the 13 blocks of the reconstruction. Plaintiff did so under protest and it now sues to recover the cost contending the order was an unlawful exercise of the Village’s police powers. After a nonjury trial the court agreed, finding that the undergrounding was not included in the reconstruction plans, that it was not a necessary part of the improvement, and that it was ordered by defendant for aesthetic reasons. The parties stipulated that the addi [456] tional cost of the relocation to plaintiff was $75,753.96 and the court awarded it judgment in that amount. There should be an affirmance. It is established law that a utility company granted the privilege of maintaining its facilities in public streets must relocate them at its own expense “ ‘whenever the public health, safety or convenience requires the change to be made’ ” (Matter of Consolidated Edison Co. of N. Y. v Lindsay, 24 NY2d 309, 316, quoting Transit Comm. v Long Is. R.R. Co., 253 NY 345, 351, 352). It must do so because the privilege, authorized by statute (see Transportation Corporations Law, §27; Village Law, § 4-412, subd 3, par [6]), grants the utility no property interest in the right of way, only a license to maintain its facilities there. If the relocation is not necessary to maintain or improve the street conditions, however, the municipality must pay the cost (see City of New York v New York Tel. Co., 278 NY 9, 14; and see Ashland Oil & Refining Co. v State of New York, 26 NY2d 390). Stated another way, the municipality must not submit the utility to unnecessary and unreasonable expense when the legitimate exercise of the police power does not require it. And that is this issue here, did defendant’s order to plaintiff to underground its facilities go beyond what was reasonable and necessary? Defendant had the power to regulate the use of private property, but the legitimacy of its action depends upon whether the regulation was reasonably required to promote and enhance the public health, safety and convenience for the general police power must always be exercised within the limits of public “necessity” (see Matter of Belle Harbor Realty Corp. v Kerr, 35 NY2d 507, 511). If the regulation goes too far, the municipality’s action will be treated as a public taking for which compensation is required (see, generally, Pennsylvania Coal Co. v Mahon, 260 US 393, 415; French Investing Co. v City of New York, 39 NY2d 587, 593-595, app dsmd and cert den 429 US 990; Lutheran Church in Amer. v City of New York, 35 NY2d 121, 128-129). Governmental action, of course, does not always fit within these “theoretically tidy” distinctions (see Loretto v Teleprompter Manhattan CATV Corp., 53 NY2d 124, 157 [457] [Cooke, Ch. J., dissenting]), and although the difference “between a compensable taking and a non-compensable regulation” is definable, it “is not always susceptible of precise demarcation” (French Investing Co. v City of New York, supra, p 593). Thus, in several recent cases the Court of Appeals has found it helpful to analyze the problem in this way: “government interference [with the use of private property] is based on one of two concepts — either the government is acting in its enterprise capacity, where it takes unto itself private resources in use for the common good, or in its arbitral capacity, where it intervenes to straighten out situations in which the citizenry is in conflict over land use or where one person’s use of his land is injurious to others. (Sax, Takings and The Police Power, 74 Yale L.J. 36, 62, 63.) Where government acts in its enterprise capacity, as where it takes land to widen a road, there is a compensable taking. Where government acts in its arbitral capacity, as where it legislates zoning or provides the machinery to enjoin noxious use, there is simply noncompensable regulation.” (Lutheran Church in Amer. v City of New York, supra, pp 128-129; see, e.g., Loretto v Teleprompter Manhattan CATV Corp., supra; Modjeska Sign Studios v Berle, 43 NY2d 468, 474, app dsmd 439 US 809; New York Tel. Co. v Town of North Hempstead, 41 NY2d 691, 697; French Investing Co. v City of New York, supra, p 593.) It hardly seems necessary to add that the “taking” may be just as real if the unlawful regulation requires the forced outlay of private funds for the public benefit, as it does here, as it is if the regulation unduly restricts the use of property. In either case, one owner has been singled out to suffer a disproportionate loss because of a condition which is general (see Matter of Charles v Diamond, 41 NY2d 318; Westwood Forest Estates v Village of South Nyack, 23 NY2d 424). Professor Sax stated it this way: “when an individual or limited group in society sustains a detriment to legally acquired existing economic values as a consequence of government activity which enhances the economic value of some governmental enterprise, then the act is a taking, and compensation is constitutionally required; but when the challenged act is an improvement of the public condition through resolution of [458] conflict within the private sector of the society, compensation is not constitutionally required” (Sax, Takings and The Police Power, 74 Yale LJ 36, 67). The village advances two contentions to justify assessing this cost against plaintiff. It contends that the under-grounding was reasonable and necessary for reasons of safety, but alternatively, it urges that even if it was not, the village’s police power was lawfully exercised for the aesthetic enhancement of the community. This extensive undergrounding was not required for the public safety. The improvement involved the reconstruction of West Church Street, from the Barge Canal to Main Street, a distance of approximately a mile and extending more than 13 city blocks. Plaintiff had 35 poles in place along the route and only 5 to 8 posed a danger to traffic because they were in or near the reconstructed street. There is no contention that it was impossible or impractical to move them but notwithstanding this limited interference with the reconstruction, the village ordered the undergrounding of all plaintiff’s facilities. The only other “safety” consideration the village advances is that aerial transmission lines would “conflict” with trees newly planted along the street. That is a common circumstance on city streets, however. The obligation for protecting the utility lines from the trees and maintaining them rested on plaintiff, not the village, and the location of the utility lines as they existed presented no unusual safety hazards in this respect which required undergrounding. Manifestly then, safety was not the concern which motivated the village. The order to underground was, as several witnesses acknowledged, based on aesthetic considerations. It is now established that aesthetic factors may be considered in enacting zoning laws. Indeed, although they rate well down in the hierarchy of public purposes, reasonable zoning restrictions may be imposed on private property for aesthetic reasons alone (Modjeska Sign Studios v Berle, 43 NY2d 468, 478, supra; Suffolk Outdoor Adv. Co. v Hulse, 43 NY2d 483, 490, app dsmd 439 US 808; People v Stover, 12 NY2d 462, app dsmd 375 US 42). But zoning is functionally different from activities involving the general police [459] power. Zoning ordinances represent action by the municipality to mediate the conflicting desires of individual owners in the use of their property and to co-ordinate land uses according to a general plan for community development. They interfere with the free and unrestricted use of private property, but the restriction is warranted because of the reciprocal benefits associated with the common constraints. It is this mutual benefit which justifies the ordinance restrictions, not only those reasonable and necessary for the public health and safety, but also those reasonably related to the less vital aesthetic improvement of the community. In reconstructing the street, however, the municipality was acting in its enterprise capacity. Concededly, it was necessary to order the relocation of a few poles on West Church Street and, in the eyes of some, it may have been reasonable to order plaintiff to bear the cost of under-grounding the facilities attached to them. It was not reasonable or necessary for either safety or aesthetic reasons, however, to unilaterally order the undergrounding of the facilities carried by all 35 poles. It was done by defendant without any reciprocal benefit to plaintiff not as a matter of regulation but to provide an amenity for beautification of a single-family residential area of the community at plaintiff’s expense. No doubt the undergrounding improved the area but the “strong public desire to improve the public condition is not enough to warrant achieving the desire by a shorter cut than the constitutional way of paying for the change” (Pennsylvania Coal Co. v Mahon, 260 US 393, 416 [Holmes, J.], supra). Finally, defendant contends that the order was not unreasonable because the cost of undergrounding was lessened by the village’s reconstruction work and payment for conduit. Plaintiff did not agree that the undergrounding should be done or to share in the cost of it, however, and if it was unreasonable to compel plaintiff to underground its facilities at its own cost, as we find it was, it is not less so because the village unilaterally decided to assume part of the cost. The judgment should be affirmed.