62 N.Y.2d 967 (1984)
A municipality cannot arbitrarily deny a property owner’s application for sewer connection when the property is partially within the town, the owner pays property and sewer taxes to the town, and the denial is based on reasons unrelated to the sewer system’s capacity or public health.
Summary
Svenningsen, property owners paying taxes to both the City of Rye and the Town of Harrison (including sewer taxes), sought to connect a building located on the Rye side of their property to Harrison’s sewer line after Rye approved their plan to convert the building to office space contingent on establishing sewer facilities. Harrison denied the application, conditioning approval on the town’s prior approval of the number of offices and parking area size, purportedly to manage traffic. The Court of Appeals held that Harrison’s denial was arbitrary and capricious because the owners paid taxes to the town and the reasons for denial were unrelated to sewer system capacity or public health issues.
Facts
Petitioners owned property straddling the City of Rye and the Town of Harrison, paying real property taxes to both. The property also fell within the Mamaroneck Valley Sewer District, and petitioners paid sewer taxes to multiple entities, including the Town/Village of Harrison Sewer District Number 1. A warehouse was located on the Rye side of the property line. Petitioners obtained approval from Rye to convert the warehouse into office space, contingent on establishing sewer facilities. The only reasonably close sewer line was in Harrison. Harrison denied their application to connect to its sewer line unless the town pre-approved the number of offices and parking spaces.
Procedural History
Petitioners initiated an Article 78 proceeding, arguing that the Town Board’s conditions were arbitrary, unreasonable, and an abuse of discretion. The Appellate Division’s order was affirmed by the Court of Appeals.
Issue(s)
Whether the Town of Harrison could arbitrarily deny the petitioners’ application to connect to the town’s sewer line when the petitioners’ property was partially within the town, they paid real estate and sewer taxes to the town, and the reason for the denial related to traffic congestion and not to the sewer system’s capacity or public health.
Holding
Yes, because the petitioners were entitled to have their application considered on the merits, subject to rejection or qualification upon a finding that the proposed connection, because of excessive demands on the system or otherwise, would present problems related to the sewer system or the public health of the town. Rejection of their application because of anticipated traffic congestion was arbitrary and capricious because it was unrelated to the proposed sewer connection.
Court’s Reasoning
The court reasoned that because the petitioners owned property partially within the town and paid real estate and sewer taxes to the town, they were entitled to have their application for sewer connection considered on its merits. The court cited Matter of Belle Harbor Realty Corp. v Kerr, 35 NY2d 507, 511; Matter of Bologno v O’Connell, 7 NY2d 155; and Matter of Harper v Zoning Bd. of Appeals, 55 AD2d 405, 411-413, affd 43 NY2d 980, to support the principle that a municipality’s denial should be related to the sewer system’s capacity or the public health of the town. The court found no evidence in the record that the development of the petitioners’ property would create such problems. The denial, based on anticipated traffic congestion, was deemed arbitrary and capricious because it was unrelated to the proposed sewer connection.