Loretto v. Teleprompter Manhattan CATV Corp., 58 N.Y.2d 143 (1983)

When a state statute authorizes a permanent physical occupation of property, the property owner is entitled to just compensation, and the statute must be construed to provide a mechanism for determining that compensation, even if it was initially intended as a police power regulation.

Summary

After the Supreme Court reversed and remanded the case, the New York Court of Appeals addressed the issue of compensation for a permanent physical occupation caused by a cable television wire installed on Loretto’s property under Section 828 of the Executive Law. The court held that the statute must be construed to allow for compensation. While the statute was initially intended as a valid exercise of police power, the Supreme Court’s ruling that it constituted a taking necessitated interpreting the law to include a mechanism for just compensation. The Court of Appeals modified the lower court’s judgment to clarify that the validity of the statute was contingent on the commission’s determination of just compensation.

Facts

Loretto purchased an apartment building in 1972. Unbeknownst to her, Teleprompter installed a cable television wire on the building’s roof in 1970, pursuant to a prior agreement with the previous owner. After Loretto bought the building, Teleprompter maintained the installation relying on Section 828 of the Executive Law, which limited the compensation a landlord could demand for permitting cable TV facilities on their property.

Procedural History

Loretto sued Teleprompter, arguing trespass. The trial court upheld the constitutionality of Section 828. The Appellate Division affirmed. The New York Court of Appeals initially affirmed, holding that the law was a valid exercise of police power. The Supreme Court reversed, finding a taking had occurred and remanding for determination of just compensation. The New York Court of Appeals then reconsidered the case on remand.

Issue(s)

1. Whether Section 828 of the Executive Law provides a mechanism for determining just compensation for a permanent physical occupation, as now required by the Supreme Court’s decision.
2. Whether Section 828 is unconstitutional because it violates the separation of powers doctrine, fails to provide for compensation in advance of the taking, or violates due process.

Holding

1. Yes, because the statute can be construed to empower the commission to fix reasonable compensation, subject to judicial review.
2. No, because determination of compensation by a commission is permissible, advance payment is not an absolute requirement under the circumstances, and due process concerns are adequately addressed through judicial review and potential amendment of regulations.

Court’s Reasoning

The court reasoned that because the Supreme Court had determined that the statute resulted in a taking, it must be construed, if possible, to provide for just compensation. The court found that Section 828, along with Section 816 of the Executive Law, provided the commission with the power to determine reasonable compensation through an adjudicatory process, subject to judicial review. The court dismissed the separation of powers argument, noting that administrative agencies can perform adjudicatory functions subject to judicial review. The court also rejected the argument that advance payment was absolutely required, finding that the circumstances of the case, including the small amount of compensation involved and the potential for judicial review, provided reasonable certainty that just compensation would be received. The Court addressed due process objections, stating that concerns regarding lack of notice could be addressed by modifying existing regulations. The court emphasized the importance of construing the statute to achieve the legislative aim of promoting the rapid development of the cable television industry while respecting constitutional requirements.