People ex rel. New York Central & Hudson River Railroad v. Purdy

This is a proceeding to review the 1914 assessment for purposes of taxation of the lot of ground covered by theBiltmore Hotel, in this city. The assessment covered both lot and building, and the relator claims that the building was exempt: This claim rests upon section 889a of the Greater New York charter, which provides that:

“A building in course of construction, commenced since the preceding first day of October and not ready for occupancy, shall not be assessed.”

[1, 2] Prior to July, 1912, the work of excavation had been begun, and on and prior to the 1st day of October, 1912, a considerable portion of the excavation ultimately necessary for the foundations of the building structure and for the sidewalk vaults had been completed, although it was not until some time thereafter that any cement or other building material used in and about the foundation work, or any other material entering into the superstructure itself or the grillage sustaining the same, was either delivered upon the premises or set. The building was completed some time between October and December, 1913. There is no finding to the contrary, and the evidence justifies the inference that, from the time the work of excavation began, the building operations continued in due course and without unusual interruption. The interpretation contended for by the relator, and which was adopted by the court below, is that, within the meaning of the charter, construction of a building has not “commenced” until something has been done towards setting in permanent place, or at least bringing to the site with the intention in due course to incorporate it into the work, some of the component parts of the building structure or its foundations. I think this is altogether too narrow an interpretation of the statute, and one which foils its purpose. Section 892 of the charter, as amended by Laws 1903, c. 454, provides that the assessment books shall show the sum for which the parcel assessed “would sell for if wholly unimproved,’! and also the sum for which it would sell “with the improvements, if any, thereon.” The latter sum is the value on which the assessment is to be based. It is manifest that, in the case of lands on which buildings are in course of construction, any attempt to ascertain the increase in sale value of tile land, due to the presence of an unfinished building, would, in many cases, be exceedingly difficult, if not impossible. What, if any, value, in the market, an uncompleted building would add to the ground, would depend largely on the question of the extent to which the work already done adapted itself to the purposes of a purchaser. To one the proposed improvement might be wholly undesirable, while to another it might present elements of value sufficient to induce a large bid.

But, under the - most favorable conditions, the attempt to value the land, plus the improvement, might be no easy matter. Where the building operation had progressed to but a small extent, or where it was substantially finished, the task would not be so difficult. But at intermediate stages, where the structure, so far as it had progressed, might commonly be found to consist of a mere congeries of parts, it would, in the nature of things, be little more than guesswork for any one to say to what extent, if any, they added to the sale value of the land. The evident purpose of the section in question (889a) was to strike an average, to give to the property owner the benefit of a total exemption during a'certain period of construction, and thereafter to

I think the statute plainly contemplated that the exemption period should begin from the time when any material portion of the work incident to -the new building has been begun on the proposed site, including the time when excavation of the ground to receive the foundations or other portions of the structure, which are to be placed below the surface, has been commenced, with a view to its continuance and completion in due course, and that it would be entirely outside of the purpose of the statute to allow an owner the benefit of the period during which this preliminary but most essential work was in progress, and construe his period of exemption as beginning only when the actual construction of some portion of the physical thing that subsequently becomes the building had been commenced. In Pusey & Jones v. Penna. Paper Mills (C. C.) 173 Fed. 634 , 647, the question arose under a mechanics’ lien statute, which in the case of original construction, as between liens thereunder and mortgage or other liens placed prior thereto, was so expressed as to relate,back and .take .effect “as of the date of the visible, commencement .upon the ground of the work of building the structure or other improvement.” After referring to’the words-of the statute, as .above quoted, the court said:.

“This calls for something of such a marked and substantial character as to attract attention and convey notice that a new structure or improvement has .been begun.”

Continuing, the court cites, holding that the following acts were not to be considered as “commencement * * * of the work of building,” to wit: the mere placing of lumber or materials on the ground; the staking out of the building or line of foundations; the clearing of the land of brush and stumps and putting it in a condition to begin work on the building proper; the demolition of an old building or the clearing away of the debris after a fire. The court further said:

“The excavation for the foundation of the new structure is the accepted test of its commencement, to which mechanics’ liens relate. * * * And even this must have so far progressed as to be readily observed. A mere scratching of the ground is not enough. * * * ‘The removal of the sod, the turning over of the soil, or such other equivocal acts as would not fairly indicate the purpose to build do not constitute the commencement of the building. To satisfy the law, so much must be done of a permanent character as will apprise observers that building is in progress.’ Jacobus v. Mut. Ben. Life Ins. Co., 27 N. J. Eq. 604 .”.

In Brooks v. Lester, 36 Md. 65 , 70, under a Maryland statute, where the date of the priority of liens depended upon the date of the “commencement of the building,” the Court of Appeals of Maryland said:

“What the law means by these terms is some work and labor on the ground, the effects of which are apparent, easily seen by everybody, such as beginning to dig the foundation, or work of like description, which every one can readily see and recognize as the commencement of a building.”

These cases are persuasive inasmuch as they construe language similar to that used in the section of the charter now under consideration in a manner consistent with what I conceive to be its plain meaning, having regard for the purpose it was intended to subserve.

The order appealed from should be reversed, with costs, the writ dismissed, and the assessment confirmed as levied, with costs. Settle order on notice.

CLARKE and DOWLING, JJ„ concur.

(dissenting). This is a-certiorari proceeding instituted to review the 1914 assessment for purposes of taxation of real property in the city of New York, known as the Hotel Biltmore, occupying the block bounded by Madison and Vanderbilt avenues, Forty-Third and Forty-Fourth streets. The assessment was made as of October 1, 1913, and it is alleged by the relator and has been found by the court at Special Term that the construction of the hotel building had been commenced since the preceding October 1st (1912), and that on October 1, 1913, it was still in process of construction and not yet ready for occupancy. The reduction of the assessment is claimed under section 889a of the Greater New York charter (chapter 324, Laws of 1913) which reads as follows:

“A building in course of construction, commenced since the preceding first day of October and not ready for occupancy, shall not be assessed.”

In construing statutes there are certain fundamental rules which are so well established that they may fairly be termed elementary. One is that they are to be read according to the natural and obvious import of their language, without resorting to a subtle or forced construction either limiting or extending their effect, and another, perhaps the basic rule, is that statutes shall be so construed as to give effect to the apparent intent of the Legislature. In seeking to discover the intent of the Legislature, it is proper to consider other sections of the same act, as well as independent statutes in pari materia.

The particular word to be defined, in the act under consideration, is the word “construction,” as applied to a building. The dictionary definitions of the words “building” and “construction,” which have frequently been referred to by the courts, are such as to exclude a mere hole in the ground upon which it is intended to erect or construct a building. In Black’s Law Dictionary a building is defined as:

“A structure or edifice erected by the hand of man, composed of natural materials, as stone or wood, and intended for use and convenience”—citing Truesdell v. Gray, 13 Gray (Mass.) 311 ; State v. Moore, 61 Mo. 276 ; Clark v. State, 69 Wis. 203 , 33 N. W. 436 , 2 Am. St. Rep. 732 .

In-our own state the word is defined as follows, in Rouse v. Catskill & New York Steamboat Co., 59 Hun, 80 , 13 N. Y. Supp. 126 :

“The word ‘build’ is derived from the word ‘bold,’ meaning a dwelling. A building is defined to be ‘a structure in the nature of a house built where it is to stand.’ Murray’s Dictionary. ‘As commonly understood, a house for residence, business, or public use, or for shelter of animals, or storage of goods.’ Century Dictionary. And very generally, though not always, the idea of a habitation for the permanent use of man, or an erection connected with his permanent use, is implied in the word ‘building.’ Bouvier defines the word as ‘an edifice erected by art and fixed upon or over the soil, composed of different pieces of stone, brick, marble, wood, or other proper substance connected together, and designed for permanent use in the position in which it is so fixed.’ A building is a part of the land. One would not call a tent a building. As said in one case of the word ‘building’: ‘In its broadest sense it can mean only an erection intended for use and occupation as a habitation, or for some purpose of trade, manufacture, ornament or use, constituting a fabric or edifice, such as a house, a store, a church, a shed.’ Truesdell v. Gray, 79 Mass. (13 Gray) 311 .”

See, also, Bouvier’s Law Dictionary; Webster’s Unabridged Dictionary ; ■ Standard Dictionary; Am. & Eng. Encyclopedia of Law (2d Ed.) vol. 4, p. 995.

When we come to consider the section of the charter under which the exemption is claimed, we find that it follows immediately upon a section (889) which requires the assessors, in making tip the assessment list, to separately state, as to each parcel assessed, “the sum for which, * * * under ordinary circumstances,” it “would sell if * * * wholly unimproved, and * * * the sum for which * * * the same parcel of real estate would sell with the improvements, if any, thereon.” In other words, the assessors are to separately estimate the value of the parcel, and the value of the improvement thereon; each being estimated according to the assumed selling value. The purpose of section 889a undoubtedly was to encourage building by extending to a builder a limited exemption from taxation while his building was going on. But for this section it would be the duty of the assessors, in valuing a parcel of land occupied by an uncompleted building, to estimate something for the partially completed improvement. It was to avoid that injustice, as I consider, that the section was adopted. An excavation in a lot would ordinarily add nothing to the. value of the lot to a purchaser unless he desired to erect upon it a building very similar to that for which the excavation had been designed. In many cases it* would doubtless detract from the value.

In my opinion the ordinary and natural meaning of the words used, as well as the obvious intent of the Legislature, requires us to hold that the “construction of a building,” within the meaning of section 889a of the charter, is that it applies to actual construction, and not to the preparation of the ground to receive the structure.

For this reason I am of opinion that the order appealed from was right, and should be affirmed, with $10 costs and disbursements.

INGRAHAM, P. J., concurs.