Opinion ID: 1981302
Heading Depth: 1
Heading Rank: 13

Heading: Exclusive Privileges Clause

Text: Plaintiffs argue that Chapter 1 violates article III, § 17 of the State Constitution by authorizing Empire alone to convert to a for-profit corporation. Article III, § 17 prohibits the Legislature from adopting a private or local bill falling into 1 of 14 specified categories. The twelfth category encompasses bills [g]ranting to any private corporation . . . any exclusive privilege, immunity or franchise whatever. Thus, two elements are required in order for a bill to offend article III, § 17. First, the bill must be directed at a single entity ( see Matter of Henneberger, 155 NY 420, 425-426 [1898] [the fact that an act operates only upon a limited area, or upon persons within a specified locality and not generally throughout the state, is, in most cases, a reasonably accurate test by which to determine whether the act is general or local (internal quotation marks omitted)]). Second, the bill must confer a privilege upon the single entity to the exclusion of all others. Both elements  singleness and exclusivity  must be present. Otherwise, all legislation directed at a single entity would be invalid. Chapter 1 is a private or local bill because it applies only to Empire. But Chapter 1 does not confer an exclusive privilege because it does not authorize Empire to prevent others from seeking to convert under similar parameters, or promise Empire that other not-for-profits will not be granted similar rights ( see Trustees of Exempt Firemen's Benevolent Fund of City of N.Y. v Roome, 93 NY 313, 328 [1883] [exclusive means that the privilege the beneficiary receives from the local or private law would be disturbed or invaded if the State should give to another corporation the same rights]; Matter of Union Ferry Co. of Brooklyn, 98 NY 139, 150 [1885] [The constitutional prohibition was evidently aimed at monopolies. At granting to corporations or individuals not merely privileges and franchises not possessed by others, but the right to exclude others from the exercise or enjoyment of like privileges or franchises]). [27] Indeed, Chapter 1 only grants Empire the right to operate as a for-profit insurer, a right that numerous other insurers currently enjoy in New York, and which others may receive upon application to the Superintendent. Because the privilege granted to Empire is not exclusive, Chapter 1 does not violate article III, § 17.