State of New York v. Ole Olsen, Ltd., 38 N.Y.2d 972 (1976)

Developers can be held liable for creating a dangerous sewage condition on properties they formerly owned, even after conveying the properties to homeowners, and may be ordered to construct a corrective sewage disposal system.

Summary

The New York Court of Appeals held that the original developers of a residential tract, Ole Olsen, Ltd. and Richard Grusmark, were liable for creating a dangerous and unhealthy sewage condition on the properties, even though they no longer owned them. The court affirmed the lower court’s order requiring the developers to construct a corrective sewage disposal system at their own expense. The court modified the judgment to allow the developers to apply for future modifications regarding the operation and financing of the system and to preserve the Attorney General’s right to seek further relief.

Facts

Ole Olsen, Ltd. and Richard Grusmark were the original owners and developers of a residential tract. After developing the tract, they conveyed all their interest in the properties to the present homeowners or their predecessors. Subsequently, a dangerous and unhealthy sewage condition developed on the properties. The State of New York brought an action to compel the developers to remedy the sewage problem.

Procedural History

The trial court determined that Ole Olsen, Ltd. and Richard Grusmark were liable for creating the sewage condition. The trial court ordered them to construct a corrective sewage disposal system. The Appellate Division affirmed the trial court’s determination. The case was then appealed to the New York Court of Appeals.

Issue(s)

1. Whether the original developers can be held liable for creating a dangerous sewage condition on properties they no longer own?

2. Whether the developers can be ordered to construct a corrective sewage disposal system at their own expense?

3. Whether the judgment should include provisions for future modifications regarding the operation and financing of the sewage disposal system?

Holding

1. Yes, because the developers created the dangerous sewage conditions.

2. Yes, because the developers were responsible for creating the nuisance.

3. Yes, the judgment should be amended to allow the developers to apply for future modifications regarding the operation and financing of the system, and to preserve the Attorney General’s right to seek other appropriate relief, because circumstances may change over time requiring adjustments to the remedy.

Court’s Reasoning

The Court of Appeals found no sufficient basis to disturb the lower court’s determination that the developers were liable for creating the dangerous sewage conditions. The court emphasized that all affected homeowners were parties to the action and did not object to allowing access to their properties for construction. The court addressed concerns regarding the future operation of the sewage disposal system by modifying the judgment to allow the developers to apply for future modifications concerning the operation and financing of the system. This provision ensures flexibility to address changing circumstances. The court also preserved the Attorney General’s right to seek further relief against any party to abate the nuisance. This ensures that the state retains the power to address any future issues that may arise. The court noted that problems of fashioning remedial relief other than by way of damage against these defendants who no longer hold any interest in the properties, have been obviated in this case because all presently affected homeowners have been made parties to this action, and none has taken exception to that portion of the judgment by which each is directed to permit reasonable entrance on his property for the construction of the corrective sewage disposal system.