Homer Engineering Co. v. State — 12 N.Y.2d 508

Majority

p. 508

Homer Engineering Company, Inc., Respondent, v. State of New York, Appellant.

Argued April 2, 1963;

decided May 9, 1963.

p. 509

Louis J. Lefkowits, Attorney-General (Paxton Blair of counsel), for appellant.

I. The Attorney-General has the right and the duty to challenge the constitutionality of a statute directing the disbursement of State funds in a manner not sanctioned by the Constitution itself. (Rosalsky v. State of New York, 254 N. Y. 117 ; Ausable Chasm Co. v. State of New York, 266 N. Y. 326 ; Hines v. State of New York, 134 Misc. 1 ; Gordon v. State of New York, 233 N. Y. 1 ; People v. Tremaine, 281 N. Y. 1 ; Farrington v. State of New York, 248 N. Y. 112 .) II. Chapter 537 of the Laws of 1961, having been passed after claimant’s claim had been wiped out by the passage of six years from the date of the receipt of the check, palpably contravenes the express terms of section 19 of article III of the New York Constitution. (Farrell v. City of New York, 197 Misc. 1059 ; Matter of Dee v. State Tax Comm., 257 App. Div. 531 , 282 N. Y. 617 ; Matter of Furey v. Graves, 148 Misc. 785 , 241 App. Div. 897 , 266 N. Y. 415 ; Oswego & Syracuse R. R. Co. v. State of New York, 226 N. Y. 351 ; Coish v. State of New York, 23 Misc 2d 117 ; City of Buffalo v. State of New York, 116 App. Div. 539 , 191 N. Y. 534 ; Bogart v. County of Westchester, 185 Misc. 561 , 270 App. Div. 274 , 296 N. Y. 701 .)

Emanuel Harris, Max E. Greenberg and Leonard Shabasson for respondent.

The Enabling Act does not contravene the Constitution. (Oswego & Syracuse R. R. Co. v. State of New York, 226 N. Y. 351 ; Matter of Dee v. State Tax Comm., 257 App. Div. 531 , 282 N. Y. 617 ; Coish v. State of New York, 23 Misc 2d 117 ; Farrington v. State of New York, 248 N. Y. 112 ; Matter of Stone v. Graves, 258 App. Div. 381 , 283 N. Y. 470 ; Campbell v. State of New York, 186 Misc. 586 ; Bogart v. County of Westchester, 185 Misc. 561 ; Matter of McCann v. Walsh Constr. Co., 282 App. Div. 444 , 306 N. Y. 904 ; Denkensohn v. Ridgway Apts., 13 Misc 2d 389 .)

Under the authority of subdivision 4 of section 588 of the Civil Practice Act, the State has appealed directly to this court from a judgment of the Court of Claims awarding claimant, Homer Engineering Company, Inc., the sum of $6,053.69.

p. 510

The facts are undisputed. Claimant performed certain work at the Middletown State Homeopathic Hospital pursuant to a contract with the Department of Mental Hygiene. On September 21, 1954, after the work was completed and accepted, payment was made by a check in the amount of $6,053.69 issued by the Department of Taxation and Finance. Thereafter, the check was mislaid by claimant. More than six years passed before claimant discovered the check and realized that it had never been deposited. Although claimant was still the holder of this unpaid State check, because of the lapse of time since its issuance section 102 of the State Finance Law prohibited the Comptroller from honoring it. As a consequence of these developments, the Legislature, on April 12, 1961, by an Enabling Act (L. 1961, ch. 537), conferred jurisdiction on the Court of Claims ‘ ‘ to hear, audit and determine the claim of the Homer Engineering Company ”, notwithstanding that said claim may have been barred by the lapse of time.

The question presented on the instant appeal is whether this Enabling Act contravenes section 19 of article III of the New York State Constitution, which provides in pertinent part: “No claim against the state shall be audited, allowed or paid which, as between citizens of the state, would be barred by lapse of time.”

The Court of Claims, relying on Matter of Dee v. State Tax Comm. ( 257 App. Div. 531 , affd. 282 N. Y. 617 ), upheld the validity of the Enabling Act, reasoning that the afore-mentioned constitutional provision was not intended to defeat a valid liquidated claim for moneys concededly owed to a claimant and thereby operate to unjustly enrich the State.

Although to deny recovery may seem harsh or unfair, well-established authorities compel that result.

This court, construing the constitutional provision involved in the present case, in Oswego & Syracuse R. R. Co. v. State of New York ( 226 N. Y. 351 ), stated (pp. 361-362): “It prohibits the legislature from subjecting the state to a less favorable limitation than the citizen * * *. It supplies [as] a maximum allowance of time * * * the rules of limitation that are applicable between citizens ”. The Statute of Limitations, of course, does not commence to run until the accrual of a legal right to relief (Civ. Prac. Act, § 11), nor will it run or continue

p. 511

to run unless there exists a tribunal of competent jurisdiction to enforce the right (Oswego & Syracuse R. R. Co. v. State of New York, supra, p. 360).

Were the instant claim the basis of an action between citizens, it would be viewed as one to recover on an ordinary check, and thus the six-year Statute of Limitations would be applicable (Civ. Prac. Act, § 48, subd. 1; Erickson v. Macy, 231 N. Y. 86 ; Farrell v. City of New York, 197 Misc. 1059 ). In the case at bar more than six years had elapsed between the time claimant made any attempt to seek relief and the accrual of the claim in 1954, when the check involved was issued (Donlon v. Davidson, 7 App. Div. 461 ; Farrell v. City of New York, supra). During this period there was available a tribunal to enforce the claim. Claimant could have procured from the Commissioner of Taxation and Finance and the Comptroller a duplicate check in lieu of the one mislaid (State Finance Law, § 101; City of Buffalo v. State of New York, 116 App. Div. 539 , affd. 191 N. Y. 534 ).

It is apparent that under the circumstances here present the Enabling Act is violative of the State Constitution and thus void.

The Court of Claims’ reliance on Matter of Dee v. State Tax Comm. ( 257 App. Div. 531 , affd. 282 N. Y. 617 , supra) was misplaced. That case involved the settlement of a decedent’s estate. A sum of money was deposited which was estimated to be sufficient to cover the transfer or inheritance tax. After the tax was fixed by an order of the Surrogate’s Court, the executrix sought a refund of that part of the deposit which was in excess of the actual tax. It was contended that this claim was barred by the Statute of Limitations, inasmuch as more than six years had elapsed from the time of the deposit. There was no enabling act involved. The court, however, held that the lapse of time was not a bar, since the Statute of Limitations did not commence to run until the right to a refund accrued when the court order fixing the tax was made.

The judgment appealed from should be reversed and the claim dismissed, without costs.

Chief Judge Desmond and Judges Dye, Fuld, Van Voorhis, Burke and Foster concur.

Judgment reversed, etc.

Cases cited

Rosalsky v. State 254 N. Y. 117 N.Y. 1930-06-03 p. 509
Ausable Chasm Co. v. State 266 N. Y. 326 N.Y. 1935-02-26 p. 509
Hines v. State 134 Misc. 1 N.Y. Ct. Cl. 1929-04-23 p. 509
Gordon v. State 233 N. Y. 1 N.Y. 1922-02-28 p. 509
People v. Tremaine 281 N. Y. 1 N.Y. 1939-06-21 p. 509
Farrington v. State 248 N. Y. 112 N.Y. 1928-05-01 p. 509
Farrell v. City of New York 197 Misc. 1059 N.Y. App. Term 1950-04-20 p. 509, p. 511
Dee v. State Tax Commission 282 N. Y. 617 N.Y. 1940-01-25 p. 509, p. 510, p. 511
Furey v. Graves 148 Misc. 785 N.Y. Sup. Ct. 1933-09-07 p. 509
Furey v. Graves 266 N. Y. 415 N.Y. 1934-12-04 p. 509
Oswego & Syracuse Railroad v. State 226 N. Y. 351 N.Y. 1919-05-20 p. 509, p. 510
Coish v. State 23 Misc 2d 117 N.Y. Ct. Cl. 1960-07-28 p. 509
Bogart v. County of Westchester 185 Misc. 561 N.Y. Sup. Ct. 1945-08-13 p. 509
Bogart v. County of Westchester 296 N. Y. 701 N.Y. 1946-11-14 p. 509
Stone v. Graves 283 N. Y. 470 N.Y. 1940-07-24 p. 509
Campbell v. State 186 Misc. 586 N.Y. Ct. Cl. 1946-06-17 p. 509
Claim of McCann v. Walsh Construction Co. 306 N. Y. 904 N.Y. 1954-04-08 p. 509
Denkensohn v. Ridgway Apartments, Inc. 13 Misc 2d 389 N.Y. App. Term 1958-06-24 p. 509
Erickson v. Macy 231 N. Y. 86 N.Y. 1921-04-19 p. 511