New York State Court of Claims

New York State Court of Claims

TARTAN v. THE STATE OF NEW YORK, #2002-030-510, Claim No. 95057, Motion No. M-64382


Application by non-party to intervene pursuant to §1012 in a trial ready appropriation proceeding denied. Interest claimed by proposed intervenor not extant at time of taking. Interest based on contract between private parties. No interpleader would lie if there were an application for same by party pursuant to §505 EDPL since no interest at time of taking.

Case Information

Claimant short name:
Footnote (claimant name) :

Footnote (defendant name) :

Third-party claimant(s):

Third-party defendant(s):

Claim number(s):
Motion number(s):
Cross-motion number(s):

Claimant's attorney:
Defendant's attorney:
Third-party defendant's attorney:

Signature date:
March 19, 2002
White Plains

Official citation:

Appellate results:

See also (multicaptioned case)


The following papers numbered 1 through 8 were read on this application to intervene by a non-party in a presumptively settled appropriation proceeding:
1,2,3 Order to Show Cause; Supporting Affidavit of Allen K. Leon; Supporting Affidavit of Carl S. Levine, Esq., Counsel for proposed Intervenor, and accompanying exhibits.
4 Affidavit in Opposition by Kenneth L. Robinson, Esq., Counsel for Claimant, and accompanying exhibits.
5 Affirmation of Rose Farrell Lowe, Esq, Assistant Attorney General for Defendant, and accompanying exhibit
6 Reply Affidavit of Carl S. Levine, Esq.
7 Additional Affidavit in Opposition of Kenneth L. Robinson, Esq.
8 Affirmation of State Defendant in Response to Opposition and Additional Opposition of Tartan Corp.

After carefully considering the papers submitted, stipulations placed on the record on November 11, 2001 and December 17, 2001, respectively, oral argument by Counsel for the Proposed Intervenor, Counsel for Claimant, and Counsel for the Defendant, heard on January 14, 2002; and the applicable law, the application is disposed of as follows:

The underlying claim is one for consequential damages resulting from the partial appropriation of certain real property located at the southwest corner of State Route 25A and Miller Place Road, Miller Place, New York, as well as the loss of fixtures, personal property, and a certain temporary easement. The claim was filed in the Office of the Chief Clerk on or about November 4, 1996. The vesting date occurred on or about June 6, 1995.

Trial of this claim had been scheduled for December 10, 2001, and has since been rescheduled for April 9, 2002.
The Order to Show Cause
On or about November 19, 2001 this Court signed an Order to Show Cause presented by Leon Petroleum, LLC, (hereafter Leon) the proposed intervenor herein, directing Tartan Corp. (hereafter Tartan), the Claimant herein, and Defendant to show cause why an Order should not be granted, "pursuant to §1012(a) Civil Practice Law and Rules and §505 Eminent Domain Procedure Law permitting Leon Petroleum, L.L.C. to intervene... [in this claim] and to succeed to all rights of Claimant in this proceeding within one hundred and twenty (120) days from the date of the order permitting intervention and thereafter permitting Leon Petroleum, L.L.C. to participate in the determination of any award...." The grounds asserted were that Leon would be "adversely affected" by any judgment, thus tracking the language of § 1012(a)(3) Civil Practice Law and Rules. A stay was imposed.
Factual Background
In or about August, 1999 - five (5) years after the taking herein - Leon asserts it purchased all the assets of Tartan, including the fee interest in the subject property. Allen K. Leon, currently the Managing Member of Leon, had served as Secretary of Tartan from 1979 to 1999, and was the person who verified Tartan's claim against the State. Agreements made in a Contract of Sale, executed on or about January 8, 1999, which included five, pre-printed, "Blumberg" form pages, and a thirty page Rider with Schedules and Appendices, are referenced as surviving the closing of title. [Affidavit of Allen K. Leon (hereafter Leon Affidavit) Exhibit "A"; also Exhibit "1" Affidavit of Kenneth L. Robinson, Esq., dated December 12, 2001]. Leon claims these documents demonstrate Tartan has "...assigned/sold its interest in the unpaid condemnation Leon, including claims for the value of the property... and other consequential damages resulting from the State's condemnation." (Leon Affidavit, Paragraph 13).

Thereafter, and on or about September 17, 1999, Counsel for Leon wrote a lengthy letter to Counsel for the State indicating its alleged interest in this claim and other claims, as "successor in interest" to Tartan. [Leon Affidavit, Exhibit "B"]. He directed that " payment be made to Tartan, or any designee of Tartan, on account of such claims,...[and indicated] that this letter should be deemed the undersigned's notice of appearance in connection with...the three claims...described." [Id.]. Copies of the letter are noted as being sent to Louis Algios, Esq., then counsel for Tartan, and to current counsel for Tartan, among others. [Id].

On or about September 22, 1999, the Assistant Attorney General responded by asking that Counsel for Leon "...forward a copy of the substitutions [as counsel] with the Court's endorsement to me and I will be glad to advise you of the current status of each claim...." [Leon Affidavit, Exhibit "C"].

Mr. Algios wrote to Counsel for Leon on September 23, 1999, disputing Leon's entitlement to any condemnation awards under the contract he had drafted. [Leon Affidavit, Exhibit "D"]. Counsel for Leon wrote back on October 1, 1999 reiterating its position, and indicating Leon's "intention to pursue its rights before the Department of Transportation." [Leon Affidavit, Exhibit "E"]. On October 8, 1999, Mr. Algios returned the salvo. [Leon Affidavit, Exhibit "F"].

Beyond this exchange, the affidavits furnished by all give no further facts concerning any entity's attempt to resolve the apparent contractual dispute. It seems that one of the three claims Leon's counsel refers to in his September 17, 1999 letter to the Assistant Attorney General was settled without any attempt by Leon to be included. [Affidavit of Kenneth L. Robinson, Esq., dated December 12, 2001, Paragraph 46]. Indeed, when another related claim was settled before this court on November 8, 2001, no mention was made of Leon's existence. (See, Claim No. 95056) At oral argument on January 14, 2002, Counsel for Leon was unable to state why Leon did not attempt to "intervene" earlier.


The Court of Claims is a court of limited jurisdiction. N.Y. Const. Art. 6, § 9; Silverman v Comptroller, 40 AD2d 225, 226 (3d Dept. 1972); NYS Thruway Authority v State of New York, 51 Misc 2d 1003 (NY Ct Cl 1966). It is empowered, among other things, to hear claims against the State "...for the appropriation of any real or personal property or any interest therein...." [ Court of Claims Act § 9(2)];[1] "...[t]o order the interpleader of other parties known or unknown whenever necessary for a complete determination of the claim or counterclaim..." [Court of Claims Act § 9(6)]; and "...[t]o hear and determine special proceedings for the distribution of moneys deposited pursuant to...[§304(E) Eminent Domain Procedure Law]."[2] The mechanism for exercising that jurisdiction varies, though the simplest is a Claimant's timely service and filing of a claim, in accordance with the appropriate limitation period [see, Court of Claims Act §§10 and 11]. The Civil Practice Law and Rules apply in the absence of "contrary direction" in the Court of Claims Act or Rules. §101 Civil Practice Law and Rules; Court of Claims Act §9(9); Easley v State of New York, 10 Misc 2d 370, 372-373 (NY Ct Cl 1957).

"Intervention" - the relief sought here - "is a procedure whereby an outsider can become a party to a pending action on her own initiative. It is sometimes available as of right [§1012 Civil Practice Law and Rules] sometimes only in the court's discretion, [§ 1013 Civil Practice Law and Rules] but it must be sought by motion in all instances." Siegel, D., New York Practice p.295 (3d Edition 1999).

In contrast "[i]nterpleader is the situation in which someone faces a possible multiple liability at the hands of conflicting claimants. It allows that person, who in interpleader context is known as a ‘stakeholder', to bring all the claimants into court to fight it out, producing a judgment binding on all the claimants and, under the doctrine of res judicata, forever protecting the stakeholder...from further suit at the behest of any of them." Siegel, D., New York Practice p.247 (3d Edition 1999).

There is no specific indication in the Court of Claims Act that a non-party may "intervene" in an appropriation claim as that term is used in §§1012, 1013 and 1014 Civil Practice Law and Rules. Accordingly, the Civil Practice Law and Rules provisions appear to apply, including the case law decided thereunder.

In this case, the proposed intervenor seeks intervention as of right, relying on §1012(a)(3) Civil Practice Law and Rules. That section provides in pertinent part that "...[u]pon timely motion, any person shall be permitted to intervene in any action...when the action involves the disposition or distribution of, or the title or a claim for damages for injury to, property and the person may be affected adversely by the judgment." Any application to intervene should include "...a proposed pleading setting forth the claim or defense for which intervention is sought." §1014 Civil Practice Law and Rules.

"[I]ntervention cannot be used as a means to revive stale claims. The court must first determine whether the addition of a new party is appropriate....[A] party may be permitted to intervene and to relate its claim back if the proposed intervenor's claim and that of the original...[claimant] are based on the same transaction or occurrence. Also, the proposed intervenor and the original...[claimant] must be so closely related that the original....[claimant's] claim would have given the...[defendant state] notice of the proposed intervenor's specific claim so that the imposition of the additional claim would not prejudice the...[defendant state]. Thus, a stranger could not intervene in a pending proceeding to interpose an otherwise time-barred claim." Matter of Greater NY Health Care Facilities Assn v DeBuono, 91 NY2d 716, 720-721 (1998).

Timeliness is built in to both the "as of right" intervention and permissive intervention statutes. See, § 1013 Civil Practice Law and Rules. Where a County had notice of the existence of certain tax certiorari proceedings some ten years prior to its application to intervene - made after the parties to the proceedings had reached settlements - it was barred from intervening on the ground of untimeliness. Buffalo Mall, Inc. v Town of Clarence, 101 AD2d 701 (4th Dept 1984).

Similarly, proposed intervenors to a civil forfeiture action were found to have waived any right to participate in the litigation when they "...failed to demonstrate that they had any real interest in the property which is the subject of...the....action....(citation omitted), [and] ...did not provide a sufficient explanation for not filing their motion to intervene in a timely manner (see, CPLR 1012; 1013). They did not move to intervene until seven months after being notified of the commencement of the action and four months after a default judgment was entered against the named defendants...." Vacco v Herrera, 247 AD2d 608 (2d Dept. 1998).

Finally, in Rectory Realty Associates v Town of Southampton, 151 AD2d 737 (2d Dept. 1989), adjoining landowners to property that was the subject of zoning litigation could not intervene more than a year after they first became aware of the dispute, and when, "[a]fter extensive negotiations, the parties entered into a proposed stipulation of settlement...." that was about to be submitted for judicial approval. The court noted "...that the delay caused by the motion to intervene would prejudice the rights of the plaintiffs in this regard....(citations omitted)." Id., at 738.

With respect to interpleader, different considerations obtain. There is authority for the use of interpleader - in limited fashion - under the Court of Claims Act, [See, Court of Claims Act §§14, 22], and there is authority for an Assignee to be substituted as a Claimant, [See, Court of Claims Act §15][3]; but interpleader is initiated by a party's motion for an "...order of interpleader or joinder of anyone claiming or imputed to have such a claim or interest." Court of Claims Act § 22(1).[4]

Additionally, if "...the court is unable for any reason to determine the various interests in the award for the property appropriated, and in any other case as justice requires, it may, in and by its award and judgment direct the comptroller to deposit the amount awarded as compensation for the property appropriated in any bank in which moneys belonging to the fund from which such compensation is payable....Any deposits made pursuant to this subdivision shall be paid and distributed to the persons entitled to the same as ordered by the supreme court on application of any person interested in such award. Court of Claims Act § 22(2).

Monies deposited pursuant to Court of Claims Act § 22(2) are then subject to claims of "...any person claiming an interest in the fund [, who] may apply to the supreme court in and for the county of Albany, for an order of verified petition setting forth the rights of any and all persons who may have, or claim to have, any interest in or lien or incumbrance on, the property so appropriated and the award therefor, and the names and addresses of such persons...." §23 Court of Claims Act. (emphasis added). Monies may be ordered deposited only when interests existing at the time of the actual appropriation are disputed [See, Abraham v State of New York, 31 Misc 2d 252 (1962)], or when the Court of Claims cannot determine the various interests. East River Savings Bank v State of New York, 266 AD 494, 498 (3d Dept. 1943).

Thus, in Abraham v State of New York, supra, 253, the Court of Claims held it was without jurisdiction to determine whether a general release signed by an assignee of the Claimant/assignor was executed in exchange for the assignment purportedly transferring all interest in the proceeds of an appropriation award. The Court refused the parties' suggestion that the Court direct that the award be deposited in a bank, saying that the deposits authorized by Court of Claims Act §§22 and 23 could be ordered only with respect " any incumbrance existing at the time of the actual appropriation."

This requirement - that whatever the interest may be must exist at the time of appropriation - is true for intervention as well as interpleader. See, e.g., Highway Displays, Inc., 3 Misc 2d 727 (NY Ct Cl 1956).[5]

The case of Owasco River Railway, Inc. v State of New York, 181 AD2d 665 (2d Dept. 1992), is illustrative with respect to interpleader. In Owasco, supra, the Court of Claims had granted claimant's motion to compel the State to pay that Court's judgment in an appropriation claim, and denied the State's cross-motion to reopen the claim and interplead a contract vendee. The Appellate Division said:
...[A]lthough the Court of Claims has the authority to grant equitable relief incidental to a claim for money judgment against the State...(citations omitted), ‘[m]andamus lies to compel performance of a purely ministerial act [only] where there is a clear legal right to the relief sought'(citations omitted).

Here the claimant did not have ‘a clear legal right' to the entire award since there existed a contract vendee...who had an equitable interest in the appropriated property and, thus, an interest in the appropriation award (citations omitted). Accordingly, the court erred in granting mandamus compelling the Comptroller to pay the judgment...

[B]oth the Court of Claims Act and the Eminent Domain Procedure Law provide that if there are any apparent liens or encumbrances on the appropriated property or if there is uncertainty as to how such an appropriation award shall be apportioned, the court shall, upon motion of a party, interplead anyone claiming or imputed to have such a claim or interest (see, EDPL 505 [B]; see also, Court of Claims Act § 22[1]). The Court of Claims Act also provides that the court ‘shall determine the respective interests and rights of the parties to the award...and direct to whom the same shall be paid' (Court of Claims Act § 22[1]).

Unlike the situation in the case at bar, the Owasco court had applications before it brought by parties to the proceedings, not a proposed intervenor. Additionally, the interest claimed appears to have existed at the time of the appropriation. See, Also, Littwin v State of New York, Claim No. 100979, M-64097, Mignano, J., November 27, 2001.

To similar effect is Henion v Comptroller of State of N.Y., 197 AD2d 807 (3d Dept. 1993)[6] where the Appellate Division reversed in part and affirmed in part a judgment of the Albany County Supreme Court - transferring to Putnam County Supreme Court - cross-petitions brought pursuant to Article 78 Civil Practice Law and Rules to compel the New York State Comptroller to pay petitioners a judgment entered by the Court of Claims in an appropriation proceeding. The Appellate Division reversed that part of the Supreme Court judgment transferring the matter to Putnam County Supreme Court, and instead transferred the cross-petition to the Court of Claims for determination. The Appellate Division said "In 1971, both the Court of Claims Act and the Real Property Actions and Proceedings Law were amended, for the express purpose of removing Supreme Court's jurisdiction over claims involving the respective interests and rights of parties to awards made for property appropriated by the State, and vesting that jurisdiction in the Court of Claims (Court of Claims Act § 22[1]; RPAPL former §1505[1]). As the...[petitioners] petition essentially sets forth a claim to the appropriation award, it must therefore be decided, in the first instance, by the Court of Claims (see also , Owasco Riv. Ry. v State of New York, 181 AD2d 665,666, 580 NYS2d 466) unless that court is unable for any reason to make such determination (see, Court of Claims Act § 22[1]). Furthermore, inasmuch as it appears that the...[petitioners] have preserved the jurisdiction of the Court of Claims by timely filing a notice of claim....(citations omitted), justice will be best served by a transfer of the cross petition to that court...(citation omitted)." Henion v Comptroller of State of N.Y., supra, at 808.

Finally, in City of Syracuse v State of New York, 121 Misc 2d 8,11 (NY Ct Cl 1983), a case concerned with determining entitlement to a fund created by an Agreement of Adjustment under § 304(E)(1) Eminent Domain Procedure Law, the Court of Claims said:
The Eminent Domain Procedure Law confers upon the Court of Claims jurisdiction to determine not only the value of appropriated property, but also to resolve conflicts of title and order the distribution of an award or fund resulting from the acquisition of property by the State of New York (EDPL 501subd [A]; 505). The EDPL provisions were intended to avoid prolonged and duplicative litigation in the Court of Claims and Supreme Court over title interest in the property, and conflicting claims to the proceeds of an appropriation...(citation omitted) interest in ‘the fund' must arise from an interest in the property appropriated. Court of Claims jurisdiction is constitutionally and statutorily limited to claims against the State of New York, claims in favor of the State of New York, or claims arising from an appropriation by the State of New York...(citation omitted).

Title interests or valid liens against real property which existed at the time of taking and are extinguished by an appropriation are preserved as liens against the award...(citations omitted). The holders of such interests have the status of condemnees under the Eminent Domain Procedure Law, and may pursue their rights in this court....

However, rights or remedies which do not arise from a valid interest in the real property, but are based upon implied or express contract between private parties, must be litigated in courts of general jurisdiction....(citation omitted).

The Court of Claims then granted Claimant's application for payment of the entire fund, saying that the Claimant's lessees "...had no legal interest in, or lien against the...premises at the time of the acquisition." (emphasis added) Id., at 12.
Neither party here - the Claimant or the State - has made application to interplead Leon. Nor would such a request be appropriate given that whatever interest Leon Petroleum asserts arose after the appropriation, and involves contractual obligations of the parties to the contract, not entitlement to a portion of an appropriation award based upon title disputes or liens extant at the time of the taking. Accordingly, the Court is not constrained to direct such interpleader given the procedural infirmity, as well as the lack of a cognizable interest on Leon's part at the time of the taking. When the property was transferred by deed to Leon, the appropriated portion was already the State's: the property interest was never Leon's.

Similarly, neither Claimant nor "...the person who succeeded claimant in interest to said claim or any interest therein...." - here, allegedly, Leon - sought "to secure from the court of claims and serve upon the attorney-general an order substituting him as party to said claim...." , "...within six months after...[becoming] invested with the title to said claim or any interest therein...." §15 Court of Claims Act.[7] See, Thellusson v State of New York, supra. This infirmity is procedural as well, given there is a clear statutory framework for asserting rights of assignment that appears to have been completely ignored.

Finally, the motion to intervene - even assuming any right to do so - is untimely, as well as procedurally defective given the failure to include a proposed claim as required. See, §1014 Civil Practice Law and Rules. The taking occurred almost six (6) years ago. Whatever agreements were entered into by Claimant and Leon were executed five (5) years ago. It is inappropriate for Leon - who has had notice of the pendency of this and other proceedings involving property in which it purportedly has some interest - to sit idly by while the matter is litigated to the point of trial, and only then attempt intervention.

At this point, this appropriation claim is scheduled for trial. Leon's remedy, if any, lies elsewhere.

The application to intervene is in all respects denied.

March 19, 2002
White Plains, New York

Judge of the Court of Claims

[1] See, also, §§ 103(c) and 501(B) Eminent Domain Procedure Law.
[2] Proceedings under § 304 Eminent Domain Procedure Law are triggered earlier on in a condemnation case, when the State and the owner negotiate an advance payment. This is confirmed by language in the statute indicating that a condemnee who has not accepted advance payment can still file an appropriation claim in the Court of Claims [§ 304(E)(3) Eminent Domain Procedure Law]; and language concerning disposition of monies deposited as an advance payment should the condemnee be granted a smaller award in the Court of Claims. § 304(H) Eminent Domain Procedure Law.
[3] "...In the event that by assignment or by operation of law, some person other than the claimant named in the claim has succeeded to the interest of...the claimant...named in such a claim, it shall be the duty of the personal representative of said claimant or of the person who succeeded claimant in interest to said claim or any interest therein within six months after he becomes invested with....any interest therein, to secure from the court of claims and serve upon the attorney-general an order substituting him as party to said claim instead of the party named in said claim, to whose right, title and interest he has succeeded, and in the event that he fails so to do, the court of claims on motion of the attorney-general, on such notice as the court may require, to all parties who have appeared in said action or proceeding or to the assignee or successor of the claimant may dismiss said claim." §15 Court of Claims Act; See, Thellusson v State of New York, 176 Misc 301 (NY Ct Cl 1941)(Assignee failed to file assignment until five years after execution; remedy in other courts); Ottaviano, Inc. v State of New York, 41 Misc 2d 578 (NY Ct Cl 1964) (No jurisdiction over purported assignment of proceeds of judgment; not an assignment of claim.)
[4] Under § 505 Eminent Domain Procedure Law, "...where a condemnor disputes a condemnee's title or a right to all or a portion of an award or a prospective award by reason of conflicting claims of title, or if there is uncertainty as to how such payment should be apportioned, the court, upon motion of any party, shall interplead anyone claiming or imputed to have such a conflicting claim or interest." (emphasis added).
[5] A fee owner sought to intervene as a party defendant in claim against State by person who had leased owner's property to put advertising signs up. Fee owner was unable to get State to pay him his adjusted payment without a release from the Claimant, which the Claimant wouldn't give without fee. Court of Claims said it had no jurisdiction to allow owner to intervene as defendant, but did "...have authority to interplead the owner of a leasehold interest with the owner of a freehold interest as a party claim. Const. Art.6 § 23; Court of Claims Act, § 9 subd. 6. Any award to the claimant...for the value of its leasehold interest must be apportioned out of the value of the unencumbered fee appropriated from...[the fee owner]...."The Court appears to have viewed the language in the fee owner's application asking for "other and further relief" to be a sufficient means for then ordering his interpleader. This seems dubious given the clear statutory language whereby interpleader may be directed only as discussed.
[6] In the trial court decision more facts are recited, confirming once again that the ‘interest' claimed existed at the time of the appropriation, the Attorney General had sought to implead the petitioners, and the petitioners claimed title by a right of reverter. See, Henion v Comptroller of State of N.Y., 153 Misc 2d 977 (Albany Co. Sup. Ct. 1992), aff'd as modified, 197 AD2d 807 (3d Dept. 1993).
[7] In the same vein, the attorney-general has not made a motion to dismiss the claim for failure to seek an order of substitution, in accordance with § 15 Court of Claims Act.