Case Name: The Staten Island Water Supply Company, Appellant, v. The City of New York, Respondent
Court: New York Supreme Court, Appellate Division
Jurisdiction: New York
Decision Date: 1911-04-21
Citations: 144 A.D. 318
Docket Number: 
Parties: The Staten Island Water Supply Company, Appellant, v. The City of New York, Respondent.
Judges: 
Reporter: Appellate Division Reports
Volume: 144
Pages: 318–326

Head Matter:
The Staten Island Water Supply Company, Appellant, v. The City of New York, Respondent.
Second Department,
April 21, 1911.
Municipal corporations contract for water supply, city of New York— section 471 of charter construed—when city liable for reasonable value of water taken — statutory construction.
Notwithstanding that section 471 of the charter of Greater New York, as revised by chapter 466 of the Laws of 1901, provides that it shall not be lawful for the commissioner of water supply to make, contracts with Water companies for'water to.be used for public purposes without the assent of the board of e stimate and apportionment and the written approval of certain municipal officers, and although it further provides that no contract for the public water supply may be made save in accordance with the requirements of said section, where the city takes water from the mains of a water supply company under the statutory duty of furnishing water for public use in a district where the city has no other water supply available, it is liable for the reasonable value of the water used although there has been no contract with the water company in compliance with the requirements of said section.
In construing municipal contracts in relation to the provisions of municipal charters, general words are to be restrained in their applica- ■ tion to the sub j ect-matter in reference to' which they are employed. The statutes are to be construed together, and the intention of the Legislature must be sought in such manner as to avoid as far as practical false consequences and palpable injustices.
Appeal by the plaintiff, The Staten Island Water Supply Company, from a judgment of the Supreme Court in favor of the defendant, entered in the office of the clerk of the county of Richmond on the 28th day of October, 1910, upon the dismissal of the complaint by direction of the court on a trial0 at the Richmond Trial Term.
T. Ludlow Chrystie, for the appellant.
Clarence L. Barber [Theodore Connoly and Archibald R. Watson with him on the brief], for the respondent.

Opinion:
Carr, J.:
The plaintiff sued the defendant to recover the sum of $13,380.88, with interest. In its complaint it tried to set forth .three separate causes of action. The defendant answered with denials generally and set up several. affirmative defenses. When the action came on for. trial the defendant moved to dismiss the complaint on the ground that it failed to state a cause of action. The motion was granted and judgment was entered accordingly, and from this judgment the plaintiff appeals. It appears in the complaint that the plaintiff is a water works company, organized under the laws of this State for the purpose of supplying water for public - and private use in a locality which now comprises the first and third wards of the borough of Richmond of the city of New York, aid which, prior to January 1, 1898, embraced the villages of Hew Brighton and Port Richmond and the town of HorthfiexL in the county of Richmond. The- plaintiff had carried on its business of public and. private water supply in the territory above described for twenty-five years prior to 1909.
For the purpose of stating and analyzing more clearly the question of law which ¡gives rise to the controversy between the parties, the second separate cause of action set forth in the complaint will, be takáq. up'for consideration first. Briefly stated, it is alleged in this cause of action that the defendant maintained in the' borough of Bichmond a public- building known as the Borough Hall; that the only source of water supply for that building was that obtainable from the water mains of-the plaintiff,¡laid pursuant to law in that locality; that the defendant tapped the plaintiff's water mains and connected the plumbing of j the ¡Borough Hall building therewith and used the water- therefrom for lavatory and sanitary uses in the Borough Hall from July-1, 1906, to. February 16,1909; that the reasonable value of the water so used was at the rate of fifteen cents for 100 cutiic feet; that the plaintiff has presented • bills for the water so usjed, amounting'tq $8,517.20, and filed a claim therefor, as provided by statute, and the defendant ba.s refused to pay the sjame or any part thereof. ' The defendant justifies its. refusal to pay on the ground that there was not between the plaintiff and the defendant - during the period of the defendant's use of the plaintiff's water any contract entered into according to the requirements of section 471 of the Greater New York charter, as revised by chapter 466 of the Laws of 1901, and as in force during the period-in question. That section provides, as follows: "It shall not be lawful for the commissioner of water supply, gas arid electricity to' enter into any contract whatever with any person or corporation- engaged in the business of supplying or selling water for private or public use and consumption, unless, preliminary to the execution of the contract, the assent of the board of estimate and apportionment, 'together with the separate written consent and approval of both the mayor and the. comptroller of the city of New York of the proposed contract in all its details, shall be given by resolution to the execution of such contract as submitted,- and. it shill not be lawful for the said city of Hew-York or for any department thereof, tó inake any contract touching or concerning the public water supply, and especially the increase thereof, with any person or corporation whatsoever, save in accordance with the provisions and requirements of this act, which said provisions and requirements, are hereby declared to establish . the exclusive rule for the making of such contracts. All proceedings relating to the making or approval of any such con- t tract may be reviewed by the Appellate Division of the Supreme Court in the" first or second department on the application of any resident taxpayer."
The section just set forth is" but a re-enactment, with the. omission of a few words, of chapter 283 of the Laws of 1900, which amended section 171 of the Greater New-York charter as originally enacted in chapter 378 of the-Laws of 1897. As this section stood in the original charj&Nof 1897 the power of the commissioner of water supply of the city of New York " to enter into any contract whate-wYwith any person or corporation engaged in the business/bf supplying or selling water for private or public use " was/made subject to the assent " of the board of public improvements." The amendment of 1900 added to the boards or^pfficers whose assent was necessary the board of estimate anfi apportionment and the mayor and the comptroller of the/city, acting separately. The "board of public improvements " was abolished by the revised charter of 1901, and the reference to said body was then omitted. The language of tlie section in its main aspects, except as to the boards or officers whose assent was required, has been practically the same from 1897, except that by the amendment of 1900 there/was added a final clause, as follows: "All proceedings relatijng to the making or approval of any such contract may be reviewed by the Appellate Division of the Supreme Court in the first or second department, on the application of any resident taxpayer. "
The inclusion of this latter clause, quite extraordinary in .its nature, is very suggestive of the history of the amendment of 1900 and the legislative intent sought to be carried out. A proposition had been brought before the board of public improvements of the city of New York to enter into a contract for a loijg term of years with a private corporation known as the Bankapo Water Company for an in'crease of the water sup ply of the city of New-'York, which would entail upon the city obligations of more than $-100,000,000, This led to much public agitation with the result that in 1900 section 471 was so amended as to increase, the number of public boards whose assent Was required to; any such contract, and to confer upon the mayor and the. comptroller, separately, a practical veto power, followed with dn attempt to cast upón the Appellate .Division of the Supreme Court in the first or second .department a power of review of what would be essentially an administrative question. Without imputing to the Legislature an intent,' frill of impracticability and verging on absurdity, literally " breakingfN^^utterfly upon a wheel," it cannot be held that section 471 applies to and controls the' situation set. forth in the'second ca!use\>f action in this complaint. This . situation discloses a water supply company with water mains in a public street, abutiing whicfe\the city maintains a public building for the proper use of whidli water is necessary. The plaintiff had the statutory duty of supplying any householder with water for premises adjoining Its mains. Any householder had the statutory right tó -be soNsupplied provided hé Was willing to pay a ljeasonable compensation therefor. The city had no water of its own for its boroughSháll, and it stood in relation to the plaintiff in the same position, as any householder. It could compel the supply but only on ifche same conditions. "If it chose tcj'avail itself of the convenience offered by the plaintiff, it assumed the duty of compensation which necessarily attended the plaintiff's statutory -duty pf supply. It never could have been intended by' the Legislatura that the city's riglit to get this! water for its borough hall an\d its duty to pay for it when it .¡got it, was to be circumscribed by the formality of a written contract entered into with me solemn assent of the board of ¡estimate and apportionment!, subject to the veto power of both, ¡mayor and comptroller, separately, and finally subject to review in.the Appellate Divísima of the Supreme Court. ' j.
It is true that section 471 declares expressly that 'fit shall riot be lawful for the s^id city of New York or for any department thereof, to make qriy contract touching or concerning the public Water supply, and especially the increase thereof, with any person or corporation whatsoever, save in accordance with the provisions and requirements of this act, which said provisions and requirements are hereby declared to establish the exclusive rule for the making of such contracts."
This very general language .relates to contracts "touching or concerning the public water supply," and it can be given ample scope without attempting tó apply it to a case where, in the absence of "the public water supply," the city takes from a private water company a supply to which it has a statutory right, for use in a building which it owns and maintains in a proprietary character.' The. contract which the law would otherwise imply under such circumstances is not, in the true meaning and application of this statute, a "contract touching or concerning the public water supply" of the city of New York.
It is a general rule of statutory construction, frequently applied to contracts of municipal corporations when viewed with relation to the provisions of municipal charters, that "general words are to be restrained in their application, to the subject matter.in reference to which they are employed." (Harlem Gas Co. v. Mayor, etc., 33 N. Y. 309; Baird v. Mayor, etc., 96 id. 567, 582, 583; Port Jervis Water Co. v. Village of Port Jervis, 151 id. 111; North River Electric Co. v. New York, 48 App. Div. 14.)
We conclude, therefore, that the facts set forth in the second separate cause of action of the complaint herein state a good cause of action against the defendant.
The same reasoning applies to the third separate cause of action set up in the complaint for "water taken by the city, under similar circumstances, for "sprinkling its streets" and for use in its "crematories, stable, park, police station, municipal property known as Griffith House," etc., and we are of likewise opinion that a good cause of action is set forth therein. . "
We are brought now to a consideration of the facts set forth in the first separate cause of action of the complaint, which we have reserved for final consideration, as possibly a' different question of law may arise therefrom. In this first cause of action the plaintiff seeks to recover for the reasonable value of the use hy the defendant of some hundreds of fire hydrants owned by the plaintiff and maintained in a territory of the city of New York in which the city maintained no "public water supply'" and in which. no" source of water supply existed other than that maintained by the plaintiff. Prior to January 1, 1898, the plaintiff for many years maintained the greater part of the fire hydrants in question under formal written contracts with the various villages and towns within the territory ¡of its operations, by. which contracts the compensation to be paid for said hydrants was fixed. The contracts were generally for the term of five years, and all of them were renewed in the year 1897 for terms of five years.. On January 1, 1898, all of these villages and towns were con- . solidated with the cityj of New York. After'said consolidation the contracts continued to run until their expiration in 1902. From timé to time additional fire hydrants, were furnished under orders from the city of New York. After the expiration of the formal contracts in 1902 no formal contract was entered into between the plaintiff and defendant relative to the compensation to be paid to ¡the plaintiff for the use by the defendant of the hydrants, but the use continued as theretofore. The defendant paid the plaintiff various sum of money on account for the use of these fire hydrants at the rate of twenty-five dollars a year for each hydrant to December 31, 1905. It continued to use them until February, 1909, when it bought out the plaintiff's plant, but has refused to make any payments for such use other than thb amounts paid, as above stated, up to December 31, 1905. It denies liability to the plaintiff for the reasonable value of the use of said hydrants on the same ground assigned in answer to the. second and third separate causes of action, viz., that there was no contract entered into between it and the plaintiff relative to the use of said hydrants under the provisions of section 471 of the Greater New York charter. S .
It seems to us that here again arises the same question of the applicability of section 471 of the charter to' the situation above outlined. By section 81 of the former Transportation Corporations Law (Gen. Laws, chap. 40 [Laws of 1890, chap. 566], as amd. by Laws of 1894, chap. 230; Laws of 1896, chap. 678, and Laws of 1907, chap. 629), which is now section 81 of the present Transportation Corporations Law (Consol. Laws, chap. 63; Laws of 1909, chap. 219), a statutory duty was cast upon the plaintiff to furnish water to the authorities of any city through which its mains or conduits may pass. The defendant had a statutory right to the performance of such duty by the plaintiff to the extent of furnishing such a number of fire hydrants as the needs of public safety might require within the, limits of the plaintiff's capacity. Such right on the part of the defendant was burdened with a corresponding duty to pay the reasonable value of the service. The relations of the parties were not purely contractual, as the duty of performance on the part of the plaintiff arose not simply from its consent but was imposed upon it by positive provisions of law. It could not refuse its fire hydrant service to the defendant except upon its own terms. In this respect its position seems radically different from that of persons who were free'to furnish or withhold goods or services, and to whom apply the long-established rule that persons attempting to contract with municipal corporations do so at the peril of observing all the. statutory requirements imposed upon municipal corporations in relation to contracts for goods or services. The plaintiff could not cut off its fire hydrant service until a contract for a definite term at a definite rate of compensation was entered into between it and the defendant, with all the assents and formalities provided by section 471 of the charter as aforesaid.
In the absence of such a contract the statute fixed the rights and duties of both parties. Here, again, we deem the provisions of section 471 inapplicable to the facts set forth in the first separate cause of action. .Nor do we think that this conclusion in any way impairs the legislative intent expressed' in the general language of that section of the charter. The contract under which the plaintiff seeks to recover is not one made in violation of the statute, but one implied by statute from the performance of ah obligation required by statute. All statutes relating to a general subject-matter must be construed together, and, no matter how general the language used, the intent of the Legislature must be sought to avoid, as far as practicable, false consequences and palpable injustices. (People ex rel. Twenty-third St. R. R. Co. v. Commissioners of Taxes of N. Y. 95 N. Y. 554, 558.)
We are of opinion, therefore, that the facts alleged in the first separate cause of action in the complaint state a good cause of action.
It follows that the judgment should be reversed and á new trial granted, costs to abide the event. .
Jenks/P. J., Hirscbberg, Thomas and Rich, JJ., concurred.
Judgment reversed and new trial granted, costs to abide the event. I .