Court Opinion

ID: 9476600
Source: CourtListenerOpinion
Date Created: 2023-08-05 06:00:20.082117+00
Date Added: 2024-06-11T17:45:24.555295
License: Public Domain

VAN GRAAFEILAND, Circuit Judge,
dissenting:
If I were convinced that my colleagues were not doing exactly what the district court did, i.e., finding section 121 unconstitutional as applied, I would be pleased to concur in Judge Kearse’s customarily fine opinion. However, because I am satisfied that this is not the case, I respectfully dissent.
A federal court which is asked to rule on a constitutional question implicating the validity of a State law is obligated to offer an *1206opportunity for intervention to the State Attorney General and to avoid reaching the constitutional question if the case can be decided under State law. The district court did neither.
Notice and the opportunity to intervene are specifically provided for whenever “the constitutionality of any statute of [a] State affecting the public interest is drawn in question” in a suit between private parties. 28 U.S.C. § 2403(b). Because Congress believed that declarations of unconstitutionality have ramifications beyond the interests of the litigants in a particular case, Heckler v. Edwards, 465 U.S. 870, 882, 104 S.Ct. 1532, 1539, 79 L.Ed.2d 878 (1984), it intended that the giving of notice be a mandatory obligation of the courts, “even if the claim is obviously frivolous or may be disposed of on other grounds.” Merrill v. Town of Addison, 763 F.2d 80, 82 (2d Cir.1985).
The present suit is one in which the constitutionality of a New York statute has been drawn in question. Denver Sewer Corporation is a creature of the New York Transportation Corporations Law, and its rates must be set in accordance with the provisions of that Law. It is undisputed that, in agreeing to an increase in sewer rates without public notice or hearing, both the Corporation and the Town believed they were lawfully exercising the authority granted . them by N.Y.Transp.Corp.L. § 121. The Town Board’s resolution expressly stated that the rate increase petition was granted pursuant to that section. In a newspaper article which appeared the following day, two Town Board members and the attorneys for both the Town and the Sewer Corporation were reported as expressing the belief that New York law did not require them to conduct a public hearing for the rate increase.
Thus, it was clear from the outset that the constitutionality of section 121 was an issue in the case. As plaintiffs conceded in the district court, “this is a case of first impression, involving the interplay between section 121 of the N.Y.Transp. [Corp.] Law and Due Process requirements as developed in very recent Supreme Court decisions.” Although the district court stated in its decision that it was not finding section 121 unconstitutional on its face but only the Town Board’s application of the statute in this case, it is well established that the constitutionality of a State statute is “drawn in question” for the purposes of 28 U.S.C. § 2403 by a challenge to its application in the facts of a particular case. Fleming v. Rhodes, 331 U.S. 100, 103-04 & n. 4, 67 S.Ct. 1140, 1142-43 & n. 4, 91 L.Ed. 1368 (1947).
Because the sewer rate determination pursuant to section 121 was a matter “affecting the public interest”, the district court erred in neglecting its statutory obligation to certify the existence of the constitutional challenge to the New York Attorney General. We now compound that error by finding unconstitutionality while neglecting our own obligation to notify the Attorney General. By enjoining the grant of a retroactive rate increase without a prior hearing, we are effectively stating that, if section 121 permits this to be done, it is unconstitutional. In sum, our holding of unconstitutionality must refer to the statute which the Town purported to follow. In my view, the legitimate State interests that Congress sought to protect through 28 U.S.C. § 2403(b) are fully implicated by a decision of this nature, and the State Attorney General should have been given an opportunity to present the State’s position.
I believe the district court also erred in failing to adequately consider whether a decision on the constitutional question could have been avoided through the resolution of an unsettled issue of State law. Railroad Comm’n of Texas v. Pullman Co., 312 U.S. 496, 61 S.Ct. 643, 85 L.Ed. 971 (1941). Despite that failure, and despite the fact that Pullman abstention has not been requested by either party on appeal, this Court has a sua sponte obligation to consider it in the first instance. Ohio Bureau of Employment Services v. Hodory, 431 U.S. 471, 480 n. 11, 97 S.Ct. 1898, 1904 n. 11, 52 L.Ed.2d 513 (1977); Catlin v. Ambach, 820 F.2d 588, 591 (2d Cir.1987). It is a firmly established doctrine of constitutional adjudication that all federal courts must consider possible statutory grounds *1207for decision, even where, as here, both sides to the dispute have urged the Court to decide the constitutional question presented. Jean v. Nelson, 472 U.S. 846, 854-57, 105 S.Ct. 2992, 2997-99, 86 L.Ed.2d 664 (1985). A rule to the contrary would “in effect reduce the abstention doctrine to a pleader’s option,” Zwickler v. Koota, 389 U.S. 241, 257, 88 S.Ct. 391, 400, 19 L.Ed.2d 444 (1967) (Harlan, J., concurring), and allow plaintiffs “to frustrate the policies underlying the doctrine of abstention by [the] simple expedient” of not raising any State law claims in their complaint. Reid v. Board of Educ., 453 F.2d 238, 242 n. 7 (2d Cir.1971).
Although N.Y.Transp.Corp.L. § 121 is silent as to whether public notice and a hearing are required before a town may approve a private sewage corporation’s petition for an increased sewer rate, I believe there is a reasonable likelihood that the New York courts would construe that statute in conjunction with other statutory provisions to require the notice and hearing which the residents of RR Village claim under the Fourteenth Amendment. The apparent purpose of permitting private sewage works corporations to enter a field previously reserved to public agencies was to provide a vital health service to the inhabitants of a subdivision without creating additional expense to the municipality involved, and thus to solve a vexing problem for growing communities. Wild Oaks Util., Inc. v. Green, 112 Misc.2d 53, 54, 445 N.Y.S.2d 941 (1981); Town of Clifton Park v. Rivercrest Sewage Corp., 96 Misc.2d 122, 124-25, 408 N.Y.S.2d 932 (1978). The State Legislature felt, however, that a private sewage corporation’s existence need be guaranteed for five years only and that thereafter it might be necessary or advantageous for the corporation to discontinue its operations. Should this occur, the local governing body is given the right to take over the operation and to “levy taxes, or sewer rents for such purposes in the same manner as if such facilities were owned by a city, town or village, as the case may be.” N.Y.Transp.Corp.L. § 119(4).
Article 14-F of New York’s General Municipal Law, which permits municipalities to establish and impose sewer rents by local law or ordinance, see Gen.Mun.L. § 452(2), provides that amendments to such sewer rents must be accomplished in the same manner. Id. This section, which was enacted in 1951, provides that sections 90 and 95 of the Village Law and sections 130 and 133 of the Town Law shall apply to both the adoption and amendment of ordinances establishing sewer rents. Section 90 of the Village Law, which has been succeeded by section 20-2002, required notice and a hearing for the enactment and amendment of the pertinent ordinances. Section 130 of the Town Law contained similar provisions. The New York State Comptroller has issued several opinions to the effect that such sewer rent amendments must be accompanied by notice and public hearing. See Opns.St.Comp. (1985) No. 85-69; (1979) No. 79-135. See also N.Y.Town L. §§ 202-a(5), 202-b, 202-d; N.Y.Mun.Home Rule L. § 20(5).
Where, as here, a statute is part of an interconnected scheme of regulation and is silent in a matter that is explicit elsewhere in the scheme, the statute may be read in conjunction with its companion statutes so as to provide a logical, overall consistency. See Boehning v. Indiana State Employees Ass’n, Inc., 423 U.S. 6, 96 S.Ct. 168, 46 L.Ed.2d 148 (1975) (per curiam); Shelton v. Smith, 547 F.2d 768, 770 (2d Cir.1976). I think the chances are reasonably good that, if given the opportunity to do so, the New York courts would hold that the Legislature expected municipalities to provide the same notice and hearings for proposed rate changes before they take over the operation of sewage works corporations as they are specifically required to provide after they take over such operations. The interests of the public are the same in both situations. That this is the consensus of the municipalities involved is apparent from the fact that public hearings almost invariably have been held in the reported cases involving petitions for sewage rate increases under section 121. Cf. Winters v. Lavine, 574 F.2d 46, 71-72 (2d Cir.1978). I do not consider the dictum in Interna*1208tional Paper Co. v. Sterling Forest Pollution Control Corp., 105 A.D.2d 278, 283, 482 N.Y.S.2d 827 (1984), a case in which a public hearing was held, to be binding New York authority for holding that a hearing is not required by section 121.
Pullman abstention is applicable even though, as here, plaintiffs challenge the constitutionality of a State law only as applied in a particular case. Winters v. Lavine, supra, 574 F.2d at 52, 69-70. That was our holding in Catlin v. Ambach, supra, 820 F.2d 588, which involved another New York statute that had not been construed by the New York courts. We there raised the issue of Pullman abstention on our own motion, recognizing that a construction of the statute at issue might moot the constitutional issue “and spare this Court from rendering a constitutional advisory opinion.” Id. at 591. I believe that is what we should do in the instant case.
In addition to all the recognized grounds for Pullman abstention, I would only note that, if the State courts were to hold that State law required notice and a hearing before either the prospective or retroactive rate increases were approved, plaintiffs would receive all the relief they seek, not the half-a-loaf this Court is now providing.