text:
    State of New York et al., Respondents, v Reynard Barone et al., Appellants, et al., Defendants.
    Argued September 7, 1989;
    decided October 19, 1989

      POINTS OF COUNSEL

      Allen H. Weiss and Benjamin Shedler for appellants.
    I. The Supreme Court exceeded its jurisdiction in ordering that defendants post a $4 Vi million bond as incident to the granting of a permanent injunction. (Flacke v Onondaga Landfill Sys., 69 NY2d 355.) II. The Supreme Court did not have inherent power to order defendants to post a bond as financial security to plaintiffs. (Matter of A. G. Ship Maintenance Corp. v Lezak, 69 NY2d 1; Morgenthau v Citisource, Inc., 68 NY2d 211.) III. The order of the court below affirming the amount of the bond for $4 Vi million was an abuse of discretion. IV. There is no liability on the part of appellants for any violations caused solely by the acts of the operators and no basis exists to find them equally chargeable under the ECL solely because of their ownership of the land.

      Robert Abrams, Attorney-General (John G. Proudfit, O. Peter Sherwood, Helene G. Goldberger and Harvey Berman of counsel), for respondents.
    I. The trial court had jurisdiction and authority to require defendants to post a bond. (829 Park Ave. Corp. v La Bruna, 109 AD2d 608; Kaminsky v Kahn, 23 AD2d 231; Ripley v International Rys., 8 AD2d 310, 8 NY2d 430; London v Joslovitz, 279 App Div 280; United States v First Natl. City Bank, 379 US 378; Weinberger v Romero-Barcelo, 456 US 305; Flacke v Onondaga Landfill Sys., 69 NY2d 355; Capital Tel. Co. v Pattersonville Tel. Co., 56 NY2d 11; Civil Aeronautics Bd. v Aeromatic Travel Corp., 489 F2d 251; Interstate Commerce Commn. v B & T Transp. Co., 613 F2d 1182.) II. The amount of the bond imposed by the court accurately reflected the anticipated cost of closure. III. Appellants are liable for proper closure of the landfill. (Board of Health v Copcutt, 140 NY 12; State of New York v Schenectady Chems., 117 Misc 2d 960, 103 AD2d 33; State of New York v Shore Realty Corp., 759 F2d 1032.)
   OPINION OF THE COURT

Bellacosa, J.

Confronted by the defendants landfill owners repeated violations of regulatory and even prior judicial directives, the Department of Environmental Conservation (DEC) exercised its statutory prerogatives (ECL 71-2727 [2]; see also, ECL 27-1313 [5] [a]), turning to the court once again to secure the closure of an illegal landfill located adjacent to Route 17 in Tuxedo, New York. After trial, Supreme Court ordered the defendants to shut down the landfill. This has not been appealed or challenged.

Supreme Court also decreed at the request of the State Attorney-General that the defendants should post a $4Vá million bond to cover the proven estimated expenses of the landfill closure. That issue and the amount fixed were also the subject of the trial and of adduced evidence, including expert testimony. This relief was designed to secure effectuation of the court’s primary decretal provision — that the illegal landfill be safely closed under the supervision of the regulatory agency charged with that oversight responsibility (ECL 27-1313). Only the bond relief has been appealed by defendants to the Appellate Division and to this court. Their claim in essence is that the court lacked authority to grant this relief. The Appellate Division rejected that argument and unanimously held that the Supreme Court properly exercised its authority. We agree and affirm.

Defendants own a 12-acre site adjacent to Route 17 in Tuxedo, New York. They contracted with defendant Material Transport Service to deposit, weekly for a year, construction and demolition debris on the site to bring the land level with Route 17 and thereby increase the value of their land. The work began in early March 1987. Within two weeks, a DEC engineer inspected the site and discovered the presence of materials requiring a DEC permit. On March 24, the engineer met with defendant Barone and informed him that, unless he obtained the permit, the site would be closed. On April 12, the DEC regional attorney sent Barone a letter reiterating the Department’s four prior warnings and again advising him that continued dumping was in violation of the law and financial sanctions were possible. Six months later, the dumping was continuing unabated. Faced with defendants’ indifference to or defiance of its repeated regulatory efforts and with increasingly pervasive foul odors emanating from the landfill site, the DEC turned to the courts for help, as authorized bv ECL 71-2727 (2).

Supreme Court’s temporary restraining order of October 5, 1987 barred further operation at the landfill except for the addition of "clean fill” to cover the site and decrease the odors. Even the exception was withdrawn and all landfill activities were directed to be halted later that month, after the trial court was informed that defendants were not adding "clean fill” but rather a dark, oily substance that was apparently industrial waste. The new, total restraining order continued until January 1988, when Supreme Court held 12 days of hearings on the State’s application for an injunction which issued on March 21. The court order, among other things, directed that the industrial waste brought in as "clean fill” be stored initially, so a determination could be made as to whether the material constituted an independent health threat. Nevertheless, the defendants continued to spread the suspicious refuse over the site. The court also ordered defendants to post a $100,000 bond to ensure the odor would be dissipated. Defendants failed to comply and did not post this bond. Throughout the proceedings, the DEC subpoenaed, but defendants never produced, various records as part of its continuing investigation. The trial court concluded that defendants were engaged in "a concerted effort to 'stonewall’ the investigation and to hinder discovery”. After the parties stipulated that the landfill site would cease all operations until a proper DEC permit was obtained, the State applied for security, in the form of a bond, to ensure payment covering the anticipated costs associated with the permanent closure. After a trial on that specific issue — the only one now before us — the court granted the State’s application and ordered defendants to post a bond of $4 Vi million. Although the court in effect remitted the matter to the DEC for a formal administrative proceeding to determine how best to minimize the closure’s adverse impact on the environment, the court’s judgment finally determined the issues and the injunction action.

The traditional judicial equity power in NY Constitution, article VI, § 7 is implemented by CPLR 3017 (a), which prescribes that "the court may grant any type of relief within its jurisdiction appropriate to the proof whether or not demanded, imposing such terms as may be just.” Our common-law process enhances this peerless feature of Anglo-American jurisprudence (see, e.g., Phillips v West Rockaway Land Co., 226 NY 507, 515; Kaminsky v Kahn, 23 AD2d 231, 237 [and cases cited]; Gibbs v Guild, 9 QB Div 59 [CA]). While "[t]he essence of equity jurisdiction has been the power of the Chancellor to * * * mould each decree to the necessities of the particular case” (Hecht Co. v Bowles, 321 US 321, 329; see also, 1 Pomeroy, Equity Jurisprudence § 109 [5th ed]), the limitations on the variety, flexibility and sweep of its potential application must be reflected in a proportionate, prudential discretion by the initial equity trial court and then by a discerning scrutiny, especially of the intermediate appellate court possessing coordinate authority in that respect, along with its appellate review power (Majauskas v Majauskas, 61 NY2d 481, 493-494; Northern Westchester Professional Park Assocs. v Town of Bedford, 60 NY2d 492, 499; 1 Newman, New York Appellate Practice § 4.01).

In conjunction with the DEC’s invocation of judicial assistance, Supreme Court was able to look to statutory authority to buttress its bond imposition (see, ECL 27-1313 [5] [a]). The statute provides that the DEC may seek to recover expenses in court if it must develop and implement a remedial program for a hazardous waste disposal site after the responsible party has refused. Defendants would be ultimately responsible under the statute for the clean-up expense. The purpose of this ECL authority is consistent with the court requiring defendants to guarantee the costs of rectifying their harm. Defendants’ repeated disregard of DEC notices and at least two court orders entitled the trial court to be concerned about their accountability at the very time the court was fashioning the primary relief in the injunction action. A court, faced with this kind of history, should not have to await a formal contempt phase ensuing perhaps long after the primary decree with the possibility of thus passively tolerating increasingly serious environmental damage and personal harms in the interim. This statutory provision is an interlocking support mechanism for the court’s action. When DEC seeks expressly authorized judicial assistance to enforce its rules or regulations (see, ECL 71-2727 [2]), and when the facts are so egregious, the court’s power should be flexible.

Evolving manifestations of judicial equity authority may be found in the protection of our environment by direct, prohibitive injunction (Campbell v Seaman, 63 NY 568, 582-583), by assessment of continuing damages against the polluter (Boomer v Atlantic Cement Co., 26 NY2d 219, 226), and by the Commissioner of the DEC invoking a court’s jurisdiction to buttress the regulatory agency’s statutory authority (Flacke v Onondaga Landfill Sys., 69 NY2d 355, 363). We hold that equity may appropriately require polluting landfill owners, who have failed to comply with DEC and court directives issued during the proceeding, to post a bond to insure that taxpayers will not bear the cost of accomplishing a judicially decreed elimination of health hazards created by defendants.

Also, we reject defendants’ contention that Matter of A. G. Ship Maintenance Corp. v Lezak (69 NY2d 1) and Morgenthau v Citisource, Inc. (68 NY2d 211) created a new requirement of express statutory authority for particular equitable relief of the kind at issue here before courts can act. In this case, there is a manifestation of legislative intent to hold polluters responsible for the costs of removing or containing noxious substances (ECL 27-1313 [5] [a]); a grant of legislative authority for the DEC to seek court assistance to enforce the relevant provisions of the Environmental Conservation Law (ECL 71-2727 [2]; compare, Flacke v Onondaga Landfill Sys., 69 NY2d, supra, at 362-363); and a proven need for a bond to insure that these defendants, who had consistently disregarded the DEC’S and the court’s directives, would not in the end be able to escape their responsibilities for the cost of the cleanup. Under these circumstances, the court was not powerless to meet the exigency.

We see no basis for concluding on this record that the lower courts improvidently or abusively exercised — as a matter of law — their invoked authority. The procedure employed by the trial court was punctiliously fair. After defendants at long last represented to the court they would stop operating the landfill site illegally, they were given an opportunity to be heard at a trial on the Attorney-General’s bond request. The preliminary injunction hearing had earlier also provided defendants a chance to make their case over the course of 12 days of trial. The proof presented by the DEC documented the trial court’s legitimate and reasonable concerns about the landfill site’s potentially adverse impact upon the Village of Tuxedo’s water supply, the Ramapo River, underlying or adjacent aquifer and surrounding property owners. The State’s expert testified with specificity to the elements comprising the estimated minimum cost to clean up the site, i.e., $4ti million. A unanimous Appellate Division reviewed the case and found that, although the expert was extensively cross-examined, "appellants offered no documentary evidence to refute this figure nor did they proffer any experts to invalidate the figure arrived at by the DEC expert despite being given every opportunity to do so” (State of New York v Barone, 147 AD2d 552, 554 [emphasis added]).

Once the urgent and delayed need to permanently close the landfill and the estimated cost to accomplish that process were established, as definitively as could be predicted at this early stage considering the relatively long-term nature inherent in the landfill closure process, the court had to grapple with defendants’ notoriously bad track record. The court should not be precluded from considering the likelihood that defendants would fail to cooperate and not pay for the judicially declared closure of their landfill; indeed, the evidence of their repeated defiance and long-standing indifference was plentiful. The disdain for numerous DEC warnings, the violation of the temporary restraining order, the subsequent use of industrial waste as landfill cover in direct violation of the interim court order, and the adjudicated "stonewalling” of the investigation all combined to support the court’s dubiety that defendants would fulfill their decreed obligations. The imposition of a bond as security in these extraordinary circumstances was, at the very least, not an abusive exercise of the court’s power.

Protection of natural resources and of threatened citizens requires a circumspect but resolute use of judicial authority. To be sure, courts may flex this kind of muscle only with carefully tailored remedies suited to the issues and proofs presented. By taking expert testimony on the Attorney-General’s application with full opportunity for cross-examination and submission of defendants’ own rebuttal evidence before the bond posting order issued, the court assured defendants a sufficient and proportionate level of specificity to warrant imposing the bond and for gauging its justification, sweep and duration. Unduly constricting the court’s authority might otherwise encourage greater indifference and transgressions, and reduce the judicial power to an abstract proposition. It would be particularly unpropitious to compel a court in the flagrant circumstances presented in this case to endure delays and virtually certain evasions that could nullify its writ.

Accordingly, the Appellate Division order should be affirmed, with costs.

Chief Judge Wachtler and Judges Simons, Kaye, Alexander, Titone and Hancock, Jr., concur.

Order affirmed, with costs.


source: Caselaw Access Project

author: Kaye, J.

license: Public Domain

text:
    Putnam Rolling Ladder Co., Inc., Appellant, v Manufacturers Hanover Trust Company, Respondent.
    Argued September 6, 1989;
    decided October 19, 1989

      POINTS OF COUNSEL

      Jeffrey S. Leonard for appellant.
    I. In order to rely on the "safe harbor” provision of UCC 4-103 (3), a bank must prove that its procedures are consistent with a general banking usage. (Five Towns Coll, v Citibank, 108 AD2d 420; White v First Natl. Bank, 22 AD2d 973; Mortimer Agency v Underwriters Trust Co., 73 Misc 2d 970; United States Fid. & Guar. Co. v Federal Reserve Bank, 590 F Supp 486; Rhode Is. Hosp. Trust Natl. Bank v Zapata Corp., 848 F2d 291; J. Sussman, Inc. v Manufacturers Hanover Trust Co., 140 AD2d 668.) II. Since the findings of the trier of fact are supported by the record, the order of the court below should be reversed and judgment should be entered for plaintiff. (829 Seventh Ave. Co. v Reider, 111 AD2d 670.)

      Robin J. Arzt and Robert M. Rosenblith for respondent.
    I. UCC 4-103 (3) does not vary the allocation of the burden of proof set forth in UCC 4-406 (3); Putnam failed to establish the standard of ordinary care required of MHT, and failed to meet its UCC 4-406 (3) burden of proof to show that MHT’s conduct did not meet the standard of ordinary care set forth in UCC 4-103 (3). (Five Towns Coll. v Citibank, 108 AD2d 420; White v First Natl. Bank, 22 AD2d 973; Mortimer Agency v Underwriters Trust Co., 73 Misc 2d 970; David Graubart, Inc. v Bank Leumi Trust Co., 48 NY2d 554; Rhode Is. Hosp. Trust Natl. Bank v Zapata Corp., 848 F2d 291; Screenland Mag. v National City Bank, 181 Misc 454; New York Credit Men’s Adj. Bur. v Manufacturers Hanover Trust Co., 41 AD2d 912; Sun Bank/Miami v First Natl. Bank, 698 F Supp 1298; Northpark Natl. Bank v Bankers Trust Co., 572 F Supp 524; United States v Hibernia Natl. Bank, 841 F2d 592, 847 F2d 840.) II. The United States Fidelity decisions are not in conflict with the decision of the court below in this case; New York State courts are not bound by the lower Federal court decisions applying New York law. (United States Fid. & Guar. Co. v Federal Reserve Bank, 590 F Supp 486; People v Laietta, 30 NY2d 68, 407 US 923; New York R. T. Corp. v City of New York, 275 NY 258, 303 US 573, 304 US 588; People v Weiner, 63 AD2d 722; Walker v Walker, 51 AD2d 1029; People v Otero, 127 Misc 2d 628, 126 AD2d 678; Rudow v New York City Commn. on Human Rights, 123 Misc 2d 709, 109 AD2d 1111, 66 NY2d 605.)
   OPINION OF THE COURT

Kaye, J.

This dispute concerns whether plaintiff customer or defendant bank should bear the loss for a series of checks forged by plaintiff’s bookkeeper and cashed by the bank. The result turns on the Uniform Commercial Code provisions for allocating the burden of proof of due care between a bank and its customer when each charges the other with negligence.

In December 1979, Putnam Rolling Ladder Company opened a checking account with Manufacturers Hanover Trust Company (MHT). Between February and December 1980, MHT paid out a total of 37 checks, amounting to $48,094, over signatures that purported to be those of Putnam’s officers. In reality, the signatures had been forged by Juanita Johnson, Putnam’s assistant bookkeeper. The checks were made payable to "Yolanda Wiggins,” an alias under which Johnson had set up a checking account. The long delay in discovering the forgery resulted from the fact that Putnam had assigned Johnson not only the duty of preparing company checks for signature but also the duty of reconciling its bank statements.

On December 8, 1980, 10 months after the defalcations began, Putnam notified defendant of the forged checks. This action, seeking to recover the $48,094 that defendant had allegedly negligently paid out over the forged drawer signatures, followed. MHT claimed in its answer to the complaint that Putnam had failed to exercise reasonable care and promptness in examining its bank statements and canceled checks, and was therefore precluded from asserting the forgeries against MHT.

At the bench trial that followed, the president of Putnam testified about the company’s bookkeeping procedures. As to MHT’s negligence, Putnam introduced into evidence five checks cashed by defendant during the same period the forged checks were cashed, each bearing only one signature, despite the fact that Putnam’s corporate banking resolution required two.

Testifying for MHT, the manager of its bookkeeping division stated that a clerk compared each check that came into the bookkeeping center against the signature card on file; a clerk reviewed approximately 4,200 checks during a four-hour shift, allowing at most four seconds to inspect each check. The bank put in no evidence of clearing house rules or general banking usage with respect to check-clearing procedures. The bank’s only other witness was an accounting expert who opined that it was inadvisable for a company to permit the same person to issue checks and reconcile the statements.

Finding both parties negligent, the trial court applied comparative negligence principles and awarded Putnam half of its loss, after subtracting $4,357.20 repaid by the former bookkeeper. The court found that Putnam had been negligent in not promptly examining its bank statements as required under UCC 4-406 (1) and in entrusting the same employee with responsibility for issuing checks and examining bank statements. The court found MHT negligent in that the high volume of work in its check-clearing department "would prevent any realistic chance of detecting forgeries and other irregularities and amounted to a lack of ordinary care.” The court considered MHT's payment of checks with missing signatures further evidence of its failure to exercise reasonable care.

Both parties appealed — Putnam objecting to the trial court’s application of comparative negligence and MHT to the imposition of any liability on it.

The Appellate Division reversed and dismissed Putnam’s complaint, holding that Putnam had not sufficiently proved the bank’s lack of ordinary care in paying out the forged checks. The court held that plaintiff’s failure to establish that MHT’s check-review procedures were not consistent with clearing house rules or general banking usage, as provided by UCC 4-103 (3), was tantamount to failure to meet its burden of proving that defendant did not act with ordinary care. The court further found error in according any evidentiary value to the fact that defendant had paid out on five checks bearing only one signature, as that did not establish defendant’s negligence in paying checks with two signatures. Concluding that the Appellate Division erred in both respects, we now reverse.

The UCC Scheme for Loss-Shifting

Articles 3 and 4 of the UCC envision a series of shifting burdens of risk of loss with respect to forged checks. Initially, the law places the risk of forgeries on the bank. A forged signature is "wholly inoperative as that of the person whose name is signed” (UCC 3-404 [1]), and therefore is not "properly payable”, and the bank cannot debit the depositor’s account (UCC 4-401 [1]). This is, of course, in accord with the pre-UCC theory of the relationship between a bank and its depositor as a debtor-creditor contract, under which payment of a forged check is a breach of the bank’s agreement to pay out funds only upon the customer’s authorization, for which the bank is strictly liable (see, Hartford Acc. & Indem. Co. v American Express Co., 74 NY2d 153, 164).

The UCC, however, imposes certain reciprocal duties on the customer. Failure to comply with those duties shifts the burden of loss from bank to customer. UCC 4-406 imposes upon a customer the duty to inspect its statement and canceled checks with reasonable care and promptness. Failure to do so results in preclusion of any claim against the bank for repeated forgeries by the same wrongdoer after the first such forged check and statement reflecting it are made available to the customer. This rule reflects the fact that the customer is generally in a better position than the bank to prevent repetition of forgery. A skillful forgery may not be detected by even a careful bank inspector, but the customer to whom the canceled check and statement are returned should know whether or not it actually intended to authorize payment of its funds to the named payee (see, UCC 4-406, comment 3). Thus, the shifting burden of loss is intended as well to encourage the parties to use reasonable care in situations where, from a systemic point of view, that is the efficient loss-avoidance mechanism.

Finally, UCC 4-406 (3) shifts the loss of even repeated forgeries back to the bank when the customer, although in breach of its own duty to inspect its canceled checks and statements, is able to establish that the bank lacked ordinary care in paying the forged checks. As that section provides: "The preclusion under subsection (2) does not apply if the customer establishes lack of ordinary care on the part of the bank in paying the item(s).” By reallocating the burden of loss to the bank the Code thus encourages proper business practices on the part of banks as well as their customers.

Under UCC 4-406 (3), as comment 4 to that section underscores, the customer who wishes to invoke the exception to UCC 4-406 (2) preclusion bears the burden of establishing that the bank also acted without ordinary care in paying the items. Section 4-406 does not, however, define ordinary care, nor do the Official Comments specify what the customer is to prove or how. Instead, ordinary care in article 4 generally is discussed in the Official Comments to section 4-103, where it is noted that "ordinary care” is used "with its normal tort meaning and not in any special sense relating to bank collections.” (UCC 4-103, comment 4.) It would appear, therefore, that a customer could prove a bank lacked ordinary care by presenting any type of proof that the bank failed to act reasonably. In this case, plaintiff adduced such proof, to the satisfaction of the trier of fact, in the form of evidence that MHT’s inspection procedures were so superficial as to offer no realistic opportunity to detect forged checks.

Contrary to the view of the Appellate Division, evidence that MHT had — contemporaneously and, according to its own testimony, using the identical, routine procedures — paid five facially defective checks was also admissible and probative on this point. While such evidence might not be admissible or probative to show a similar act occurred on a subsequent occasion, that was not the theory on which this evidence was considered by the trial court. Rather, it was an application of the settled rule that where other injuries occur under the identical conditions as the injury in suit, those other injuries may be proved for the purpose of showing that the condition was unsafe (see, Richardson, Evidence § 196 [Prince 10th ed]; McCormick, Evidence § 200 [3d ed]). In attempting to show that MHT’s check-processing methods were not reasonable, the trial court thus properly permitted plaintiff to prove that, during the period in issue, the very same bank procedures had been insufficient to allow bank employees to spot obviously defective checks, and the Appellate Division erred in rejecting that evidence.

Burden of Proof Under The "Safe Harbor” Provision

Defendant argues that regardless of whether Putnam presented evidence of lack of ordinary care sufficient under normal tort principles, the UCC required it in addition to present a special kind of evidence concerning defendant’s banking practices: that the methods by which MHT had paid its checks did not conform to clearing house rules or a general banking usage. This contention centers on UCC 4-103 (3) — a "safe harbor” provision — which in pertinent part states that "in the absence of special instructions, action or non-action consistent with clearing house rules and the like or with a general banking usage not disapproved by this Article, prima facie constitutes the exercise of ordinary care.” Defendant contends — and the Appellate Division explicitly held — that disproof of the "safe harbor” factors in UCC 4-103 (3) is a necessary part of the plaintiffs direct case against the bank for failure to exercise ordinary care. We disagree.

UCC 4-103 (3) allows and even encourages banks to conform their practices to those in general use in the industry by providing that observance of such practices or rules "prima facie” constitutes the exercise of ordinary care. Indeed, to some extent this section compensates for what may be perceived as an unfairness inherent in the loss-shifting scheme of sections 4-406 and 3-406. Under those sections, when both the bank and its customer have been negligent — and even when the customer is by far the more negligent party — the entire loss may still be asserted against the bank (see, Phillips, The Commercial Culpability Scale, 92 Yale LJ 228, 240, n 62 [1982]). The "safe harbor” provision mitigates the harshness. Merely by showing that it acted in accordance with general banking rules or practices, a bank can ensure that its conduct at least prima facie meets an ordinary care standard.

While section 4-103 (3) is silent as to which party bears the burden of proving clearing house rules or general banking usage, we conclude that the burden should rest on the bank— the party seeking the advantage offered by the provision — not on the customer.

First, the bank is by far in the better position to come forward with proof on this issue. It knows its own practices, and is surely better situated than the customer to be aware of how those practices compare to those of other banks. In fact, given the breadth of what can qualify as "general banking usage” (see, UCC 4-103, comment 4), it is at the least inefficient to impose on the customer the burden of disproving all these possibilities, in the absence of any indication on the bank’s part of which general practices support its own.

Moreover, the "prima facie” language of 4-103 (3) itself suggests that conclusion. Generally, a party makes out its own prima facie case, leaving rejoinder for the adversary. It is both awkward and purposeless to require plaintiff to establish the existence of relevant rules and usage, and then to demonstrate either that defendant’s action was inconsistent with them or that the rules and usage were unfair or unreasonable (UCC 4-103, comment 4). Unless a defendant advances a genuine issue on this point, it is unnecessary and potentially confusing to ask a plaintiff to make both sides of the issue. In addition, a general banking usage is a species of trade usage (UCC 1-205 [1]), and the burden of proving a trade usage has generally been placed on the party benefiting from its existence (see, 1 White & Summers, Uniform Commercial Code § 3-3, n 42, at 140 [Practitioner’s-3d ed]).

Thus, we conclude that the Appellate Division erred in charging plaintiff for the failure to prove that MHT’s check-review procedures were not consistent with clearing house rules or general banking usage. That was the bank’s burden. The bank adduced no such evidence, thus failing to establish its entitlement to the "safe harbor” of UCC 4-103 (3).

Comparative Negligence

While the Appellate Division erred in reversing the trial court on proof of due care, that error cannot be rectified simply by reinstating the trial court judgment, which applied comparative negligence principles and divided the loss.

The importation of comparative negligence into the UCC —which was drafted before widespread acceptance of comparative fault — is not without its advocates (noted in, 1 White & Summers, op. cit., § 16-7, n 6, at 809), but has generally been rejected by both courts and commentators (id.). We agree. As one court stated in addressing this issue, "the balancing of rights under the UCC represents the ultimate distillation of a painstaking process of evolution, pursuant to which the risk of loss in commercial matters has been attempted to be adjusted in a fair and equitable manner.” (Five Towns Coll. v Citibank, 108 AD2d 420, 429-430; see also, United States Fid. & Guar. Co. v Federal Reserve Bank, 620 F Supp 361.) It is not for the courts to unsettle the UCC’s carefully drawn balance by introducing comparative fault principles taken from tort law.

Moreover, the UCC serves an important objective not shared by the law of torts (see, by analogy, Board of Educ. v Sargent, Webster, Crenshaw & Folley, 71 NY2d 21, 29). Unlike tort law, the UCC has the objective of promoting certainty and predictability in commercial transactions. By prospectively establishing rules of liability that are generally based not on actual fault but on allocating responsibility to the party best able to prevent the loss by the exercise of care, the UCC not only guides commercial behavior but also increases certainty in the marketplace and efficiency in dispute resolution. These ends would not be furthered by the introduction of the sort of fact inquiries necessitated by comparative negligence.

In that plaintiff adduced sufficient evidence of the bank’s lack of ordinary care in paying the 37 forged checks (thereby avoiding preclusion under UCC 4-406 [2] for its own negligence), and the bank offered no evidence whatever of general rules or usage, judgment should have been awarded to plaintiff in the undisputed amount of its loss.

Accordingly, the Appellate Division order should be reversed, with costs, and judgment granted for plaintiff in the amount of $43,737.02, with interest from December 9, 1980.

Chief Judge Wachtler and Judges Simons, Alexander, Titone, Hancock, Jr., and Bellacosa concur.

Order reversed, with costs, and judgment granted for plaintiff in accordance with the opinion herein.

      . UCC 4-406 (2) (b) provides: "If the bank establishes that the customer failed with respect to an item to comply with the duties imposed on the customer by subsection (1) the customer is precluded from asserting against the bank * * * (b) an unauthorized signature or alteration by the same wrongdoer on any other item paid in good faith by the bank after the first item and statement was available to the customer for a reasonable period not exceeding fourteen calendar days and before the bank receives notification from the customer of any such unauthorized signature or alteration.”

      . The parties in their briefs assume a timely claim and discuss only the duty of care question, with passing reference in a footnote to an alleged condition precedent requiring the customer to notify the bank of statement irregularities within 14 days and commence suit within one year. This time bar is contained in a bank form entitled "Banking Resolutions,” signed by the customer and apparently in wide use by the banking industry. Defendant’s footnote simply declares that the resolution is an absolute defense, and plaintiffs footnote in reply simply declares that the provision is unenforceable (as the trial court held). We confine our decision to the only question briefed by the parties in this court — the duty of care — noting particularly that the time-bar question raises policy considerations with potentially broad ramifications (see, 1 White & Summers, Uniform Commercial Code § 18-2, at 869-873 [Practitioner’s-3d ed]), properly reserved for an appeal where the parties put that question before us for resolution. By the same token, no question is raised with respect to any causal connection that must be shown between a bank’s negligence and its payment of forged checks.


author: Hancock, Jr., J.

text:
    Annunziata Carlino et al., Appellants-Respondents, v Lumbermens Mutual Casualty Company, Respondent, and Wesley A. Carr, Respondent-Appellant, et al., Defendants.
    Argued September 14, 1989;
    decided October 19, 1989

      POINTS OF COUNSEL

      Gerald Grace, Jr., for appellants-respondents.
    I. The "two or more auto policies” clause in the Lumbermens Mutual Casualty Company policy conflicts with the "other insurance” clause contained in the same policy, and as a result, the inconsistencies should be resolved in favor of the insured, Wesley A. Carr. (Lumbermens Mut. Cas. Co. v Allstate Ins. Co., 51 NY2d 651; J.G.A. Constr. Corp. v Charter Oak Fire Ins. Co., 66 AD2d 315.) II. The inclusion of the "two or more auto policies” clause renders the policy in violation of the insurance regulations authorized by the Vehicle and Traffic Law. (Lumbermens Mut. Cas. Co. v Allstate Ins. Co., 51 NY2d 651.) III. Respondent, Lumbermens Mutual Casualty Company, has been unjustly enriched by collecting full premiums from two policyholders (defendants James C. Carr and Rose M. Carr) and yet refuses to extend full coverage under both of these policies. (Butler v Lumbermen’s Mut. Cas. Co., 72 Misc 2d 489; Polland v Allstate Ins. Co., 25 AD2d 16.)

      Kevin E. Ketchum for respondent-appellant.
    I. The "two or more auto policies” clause in the Lumbermens Mutual Casualty Company policies issued to defendants Rose Carr and James Carr conflict with the "other insurance” clause contained in the same policies, creating inconsistency and ambiguity which should be resolved in favor of the insured Wesley Carr. (J.G.A. Constr. Corp. v Charter Oak Fire Ins. Co., 66 AD2d 315; Greaves v Public Serv. Mut. Ins. Co., 5 NY2d 120; Levinson v Aetna Cas. & Sur. Co., 42 AD2d 811; Hartol Prods.

      Corp. v Prudential Ins. Co., 290 NY 44.) II. The "two or more auto policies” clause causes the Lumbermens Mutual Casualty Company policies to be in violation of the New York State Insurance Department regulations promulgated pursuant to the Vehicle and Traffic Law of the State of New York, rendering the clause unenforceable. (Lumbermens Mut. Cas. Co. v Allstate Ins. Co., 51 NY2d 651.) III. The "two or more auto policies” clause in the Lumbermens Mutual Casualty Company policies does not create a spousal exclusion from the rule of ratable contribution without violating the requirements of 11 NYCRR 60.1 (g). IV. Lumbermens Mutual Casualty Company has been unjustly enriched by collecting full premiums for both policies but limiting coverage of a covered person, Wesley Carr, to the limits of only one policy. (Di Stasi v Nationwide Mut. Ins. Co., 132 AD2d 305; Ace Wire & Cable Co. v Aetna Cas. & Sur. Co., 60 NY2d 390; VanMinos v Merkley, 48 AD2d 281; De Forte v Allstate Ins. Co., 81 AD2d 465; State Farm Fire & Cas. Co. v LiMauro, 65 NY2d 369.)

      Donald T. Mahoney for respondent.
    I. The language limiting the liability of Lumbermens contained in the "two or more auto policies” clause should be accorded its plain meaning. (J.G.A. Constr. Corp. v Charter Oak Fire Ins. Co., 66 AD2d 315; Government Employees Ins. Co. v Kligler, 42 NY2d 863; Breed v Insurance Co., 46 NY2d 351.) II. The "two or more auto policies” clause in the Lumbermens policy does not conflict with the "other insurance” clause contained in the same policy. (I Q Originals v Boston Old Colony Ins. Co., 85 AD2d 21, 58 NY2d 651; Hartford Acc. & Indem. Co. v Firemen’s Ins. Co., 146 AD2d 855.) III. The "other insurance” clause and the limitation contained in the "two or more auto policies” clause are not in violation of the applicable provisions of the Vehicle and Traffic Law or the insurance regulations. (Kurcsics v Merchants Mut. Ins. Co., 49 NY2d 451; Matter of Allstate Ins. Co. v Carlough, 132 AD2d 553.) IV. Respondent, Lumbermens Mutual Casualty Company, has not been unjustly enriched by collecting full premiums from two policyholders (defendants James C. Carr and Rose M. Carr). (Maurizzio v Lumbermens Mut. Cas. Co., 73 NY2d 951.)
   OPINION OF THE COURT

Hancock, Jr., J.

A married couple residing in the same household purchased two separate liability insurance policies from the same insurer covering their separately owned vehicles. The policies, each of which had a maximum limit of $75,000 for excess insurance, were identical; each afforded coverage to their son, a member of the household, who was involved in an accident while driving another car. We hold that by the terms of the standard form "other insurance” clause, the insurer is bound to contribute to the full extent of its coverage in each policy, thus making the maximum excess coverage available for the accident $150,000. The insurer’s attempt in its "two or more auto policies” clause to limit its maximum liability under the policies to the liability limit in one of them is contrary to the applicable insurance law regulations. Accordingly, we reverse the order of the Appellate Division and hold that the insurer is liable for the cumulative limits of both policies.

I

Plaintiffs were injured in a two-car accident. One of the vehicles involved in the accident was owned by Michael Romeo and was being driven, with Romeo’s permission, by defendant Wesley Carr. It is not disputed that the insurance policy covering Romeo’s car affords primary coverage with a $25,000 limit. Lumbermens Mutual Casualty Co. (Lumbermens) issued insurance policies to James Carr and Rose Carr, Wesley Carr’s parents. Each of these policies affords excess coverage with a $75,000 limit. The Carrs’ policies are in dispute.

James Carr is the only named insured on the policy covering his pickup truck, and Rose Carr is the only named insured on the policy covering her two vehicles. The company issued each policy separately and charged and received a full premium for it. Wesley resided with his parents and was, therefore, a "covered person” within the terms of each policy.

Two clauses in the standard form Lumbermens policies issued are relevant: the "other insurance” clause and the "two or more auto policies” clause. The "other insurance” clause provides: "If there is other applicable liability insuránce we will pay only our share of the loss. Our share is the proportion that our limit of liability bears to the total of all applicable limits. However, any insurance we provide for a vehicle you do not own shall be excess over any other collectible insurance.” The "two or more auto policies” clause provides: "If this policy and any other auto insurance policy issued to you by us apply to the same accident, the maximum limit of our liability under all the policies shall not exceed the highest applicable limit of liability under any one policy.” (Emphasis added.) The term "you” as defined in the standard Lumbermens policy includes a spouse residing in the same household, and thus, where, as here, resident spouses purchase policies from Lumbermens, the "two or more auto policies” clause purports to limit Lumbermens’ liability to the maximum limit in one policy.

Plaintiffs commenced this action seeking a declaration that pursuant to the standard "other insurance” clause, both policies were available to cover losses arising from the accident, making the total liability exposure $150,000. Defendant Wesley Carr joined in this request. Lumbermens, in a counterclaim, sought a declaration that, pursuant to the "two or more auto policies” clause, its liability could not exceed the $75,000 limit in one or the other policy.

Supreme Court declared that both policies provide excess coverage up to their maximum limits and are available to satisfy any recovery against Wesley Carr. The Appellate Division, with one Justice dissenting, reversed and directed that judgment be entered declaring that only one of the policies is available, thereby reducing the maximum limit for the Lumbermens excess coverage to $75,000. We disagree. For reasons stated hereinafter, we hold that each policy must contribute to its liability limit.

II

There is no question that the "other insurance” clause in each policy provides for pro rata excess coverage (see generally, 16 Couch, Insurance 2d §§ 62:6, 62:32 [Rhodes ed]), which meets the pro rata contribution requirement contained in the applicable insurance regulation (11 NYCRR 60.1 [g]). Under ordinary circumstances, the "other insurance” clause would operate to provide excess coverage for Wesley Carr’s accident under both Lumbermens’ policies, with each policy contributing ratably making the total of available excess insurance $150,000. However, the Carrs are husband and wife residing in the same household. Given that the definition of "you” in the policies includes resident spouses, the Carrs are deemed to be one person under the "two or more auto policies” clause. Lumbermens contends, therefore, that the "two or more auto policies” clause governs and that the total of the available excess coverage that would otherwise be provided under the "other insurance” clause must be reduced to $75,000. The obvious consequence of adopting Lumbermens’ construction of the policy and giving this effect to the "two or more auto policies” clause is to cancel out the requirement in the "other insurance” clause that both policies should contribute ratably. The immediately apparent effect is to put the Lumbermens policies in direct violation of the regulation which requires that under an excess insurance provision, each policy must contribute ratably (see, 11 NYCRR 60.1 [g]).

Lumbermens argues, however, that its application of the "two or more auto policies” clause does not put its policies in violation of the regulation (11 NYCRR 60.1 [g]). It points out that the regulation only requires ratable contribution by other "valid”, "collectible” excess insurance (11 NYCRR 60.1 [g]). It is not in violation of the regulation, Lumbermens says, because, by giving effect to the "two or more policies” provision, one or the other of the Carrs’ policies has been rendered "invalid” and "uncollectible”. In other words, the "two or more policies” provision, the very clause on which Lumbermens relies to reduce the amount of available coverage, is the clause it depends on to say that there can be no violation of the regulation.

Analysis of the "two or more policies” provision, however, does not support the interpretation that Lumbermens would have us adopt. The language of the clause does not provide or suggest that either of the Carrs’ policies becomes "invalid” or "uncollectible”; nor does it make either inapplicable to a particular accident. On the contrary, the "two or more policies” clause expressly states that the policies "apply to the same accident” (emphasis added). The clause only attempts to put a limit on the amount of excess insurance which applies where there are two or more policies covering the same loss. The provision clearly lacks the wording of a "no liability” or "escape” clause and, accordingly, should not be given that effect (cf., Mills v Liberty Mut. Ins. Co., 36 AD2d 445, affd on opn below 30 NY2d 546; Davis v De Frank, 33 AD2d 236, affd without opn 27 NY2d 924; see generally, 16 Couch, op. cit., § 62:31, at 462; Ostrager and Newman, Insurance Coverage Disputes § 9.02 [c], at 23S-234). The policy as construed by Lumbermens is, therefore, not "equally or more favorable to the insured” as the ratable contribution provision of the regulations requires (11 NYCRR 60.1 [g]). The "other insurance” clause, as reduced by the "two or more auto policies” clause, thus violates this regulation.

Moreover, Lumbermens’ interpretation of the policy relies on a circular argument which produces an unacceptable anomaly. Lumbermens applies the "two or more policies” provision to reduce the coverage from what would otherwise be provided by the "other insurance” clause and required by the regulation (11 NYCRR 60.1 [g]). But it seeks to avoid a clear violation of the regulatory requirement that each "valid” and "collectible” excess policy contribute ratably by simply saying that the same clause which causes the reduction must be construed as making one or the other. policy "invalid” and "uncollectible”. Such construction of the policy — which no insured could have envisioned, least of all one paying a full premium for a separate policy — should not be given effect (see, Stainless, Inc. v Employers’ Fire Ins. Co., 69 AD2d 27, 32-34, affd, 49 NY2d 924; Miller v Continental Ins. Co., 40 NY2d 675, 676-679; Matthews v American Cent. Ins. Co., 154 NY 449, 456-459 [because a policy is drawn by the insurer, it is to be liberally construed in favor of the insured and interpreted in light of the reasonable expectation and purpose for which the policy is issued]).

Finally, Lumbermens Mut. Cas. Co. v Allstate Ins. Co. (51 NY2d 651), relied upon by the Appellate Division, is inapposite. In Lumbermens, the issue was not whether the secondary excess coverage clause was less favorable to the insured or any judgment creditor than the required provisions. Thus, no claimed violation of the regulation (11 NYCRR 60.1 [g]) was involved. The dispute in Lumbermens was among various insurers over the order in which they should pay out excess insurance. Here, in contrast, the "two or more auto policies” clause, as the insurer would apply it, reduces, by one half, the amount of coverage otherwise available and, therefore, is less favorable to the insured and any judgment creditor than either of the required provisions.

Accordingly, the order of the Appellate Division should be reversed, with costs, and the judgment of Supreme Court, Niagara County, reinstated.

Chief Judge Wachtler and Judges Simons, Kaye, Alexander, Titone and Bellacosa concur.

Order reversed, etc.

      . James previously insured his pickup through Lumbermens under a policy issued to both James and Rose. Because Rose was concerned with having her husband’s pickup reflected in her premiums, James took out a separate policy. In his application for separate coverage, James stated that his pickup had previously been covered by Lumbermens under the joint policy and that ''he just wants his own policy”.

      . Section 60.1 provides:
      "An 'owner’s policy of liability insurance’ shall contain in substance the following minimum provisions or provisions which are equally or more favorable to the insured and judgment creditors

      * ** *

        "(g) Either of the following provisions:
      "(1) The insurer shall not be liable for a greater proportion of the loss than the applicable limit of liability of the policy bears to the total applicable limit of liability of all other valid and collectible insurance covering the insured against such loss; provided, however, with respect to an automobile, other than a newly acquired automobile, for which insurance is provided under subdivision (d) of this section, the insurance shall be excess insurance over any other valid and collectible insurance.
      "(2) * * * When both this insurance and other insurance apply to the loss on [an excess] basis * * * the company shall not be liable under this policy for a greater proportion of the loss than that stated in the applicable contribution provision below:
      "(i) Contribution by equal shares. * * *
      "(ii) Contribution by limits. If any of such other insurance does not provide for contribution by equal shares, the company shall not be liable for a greater proportion of such loss than the applicable limit of liability under this policy for such loss bears to the total applicable limit of liability of all valid and collectible insurance against such loss. ” (Emphasis supplied.)

      . Assuming arguendo that the "two or more auto policies” clause in each policy could be given the effect of an "escape” or "no liability” clause, there would still be a question whether the clauses would cancel each other out, thus leaving excess coverage under each policy intact (see, Davis Yarn Co. v Brooklyn Yarn Dye Co., 293 NY 236, 249; Ostrager and Newman, Insurance Coverage Disputes § 9.03 [c] [3], at 239-240). We express no view on this issue.


text:
    The People of the State of New York, Respondent, v Cornelius Gaines, Appellant.
    Argued September 14, 1989;
    decided October 24, 1989

      POINTS OF COUNSEL

      Edward J. Nowak, Public Defender (Howard K. Broder of counsel), for appellant.
    I. The trial court erred in refusing to instruct the jury that no burglary took place if defendant formed the intent to commit a crime only after unlawful entry. (People v Kelley, 253 App Div 430; People v Haupt, 247 NY 369; People ex rel. Stevens v Jackson, 283 App Div 3; People v King, 61 NY2d 550; People v Phyfe, 136 NY 554; People v Licata, 28 NY2d 113; People v Powell, 58 NY2d 1009; People v Grieco, 266 NY 48; Messersmith v American Fid. Co., 232 NY 161; People v Crimmins, 36 NY2d 230.) II. Defendant was improperly adjudicated a second felony offender. The Mississippi burglary statutes under which he was convicted contained no requirement that a defendant knowingly enter or remain unlawfully in a building and therefore coincidence of elements with a New York felony is lacking. (People v Gonzalez, 61 NY2d 586; People v Burgos, 97 AD2d 826; People v Robinson, 115 AD2d 1012; People v White, 96 AD2d 541; People v Giraldo, 106 AD2d 401; People v Franqui, 121 AD2d 160.)

      Howard R. Relin, District Attorney (Elizabeth Clifford of counsel), for respondent.
    I. The trial court properly instructed the jury on the law. (People v Browne, 119 AD2d 684; People v Coleman, 70 NY2d 817; People v Adams, 69 NY2d 805; People v Goodfriend, 64 NY2d 695; People v Canty, 60 NY2d 830; People v Thompson, 116 AD2d 377; People v King, 61 NY2d 550; People v Phyfe, 136 NY 554.) II. The lower court correctly determined that defendant was a second felony offender. (People v Gonzalez, 61 NY2d 586.)
   OPINION OF THE COURT

Kaye, J.

The felony of third degree burglary occurs when a person "knowingly enters or remains unlawfully in a building with intent to commit a crime therein.” (Penal Law § 140.20.) The issue before us is whether, in this case of unlawful entry, the jury should have been instructed that they must find defendant’s intent to commit a crime in the building existed at the time of the entry, or whether no such instruction need have been given, because the "remains unlawfully” element of the statute means that such intent may be formed after defendant’s unlawful entry. We conclude that Penal Law § 140.20 requires that intent to commit a crime in the building exist at the time of the unlawful entry, and we reverse the Appellate Division order that upheld defendant’s burglary conviction.

The People’s evidence at trial showed that in the early morning of February 2, 1985, defendant was arrested as he emerged from the window of a building supply company. Over his own clothes defendant was wearing coveralls and a jacket that belonged to a company employee; pens bearing the company name were in the jacket pocket. Inside the building, several desks were in disarray, but other than the garments and the pens, nothing was missing from the premises and no burglar’s tools were found.

Taking the stand on his own behalf, defendant testified that on February 2, he left the homeless shelter where he had been staying, because he had inadequate funds to remain there, and he set out for a friend’s place, where he planned to spend the night. When defendant found his friend out, he walked further until he reached the building supply company, pushed in a window and entered the building for refuge from the cold and heavy snow that fell that night. Defendant claimed that he did not touch the desks, file cabinets or safe but simply put on the jacket and coveralls to keep warm and stayed near a heating vent until he heard police officers approaching.

In a precharge conference, defense counsel requested that the jury be instructed that, where there is an unlawful entry, in order for a burglary to occur the intent to commit a crime within the building must exist at the time of the entry. Counsel also argued that on the facts of this case — where it was undisputed that defendant’s entry was unauthorized — any reference to "remains unlawfully” should be omitted from the charge. The court refused both requests and charged, without elaboration, that the jury could find defendant guilty of burglary if, at the time of his knowingly unlawful entry or remaining, defendant intended to commit a crime in the building.

During deliberations, the jury asked the court for further instructions on the difference between burglary and trespass, and specifically asked whether "intent has to occur before or after entering the building.” The court reread its earlier instructions. Defense counsel again excepted, arguing that defendant’s commission of a crime as an afterthought following unlawful entry would not transform a trespass and petit larceny into a burglary, and that the jury should be so instructed. In response, the court expressed the view that the Legislature did not intend that a defendant escape prosecution for burglary "in any case where a defendant unlawfully entered a building or premises but not with a specific intent to commit a given crime and thereafter committed * * * a crime in the building”. The Appellate Division affirmed defendant’s conviction, with two Justices dissenting. Concluding that the trial court erred in denying defendant’s requests, we now reverse his burglary conviction and order a new trial.

At common law, burglary was defined "as the breaking and entering of a dwelling of another, at night, with intent to commit a felony therein.” (Hechtman, Practice Commentaries, McKinney’s Cons Laws of NY, Book 39, Penal Law art 140, at 5 [1975].) Unless the intent to commit a felony existed at the time of the breaking and entry, there was no burglary. Similarly, under the former Penal Law, a defendant who broke and entered with no intent to commit a crime was not guilty of burglary, though later deciding to commit a crime on the premises (People v Haupt, 247 NY 369, 371).

When the Penal Law was revised in 1965, burglary in the third degree was defined as "knowingly enters or remains unlawfully in a building with intent to commit a crime therein.” (Penal Law § 140.20; emphasis added.) The People’s contention in essence is that the addition of "remains unlawfully” — a concept unknown at common law or in the former Penal Law — abrogates the requirement of intent to commit a crime at the time of unlawful entry. All that is now required, according to the People, is that defendant commit a crime while unlawfully on the premises. On its face, the statute could be read to support this interpretation.

This interpretation is, however, not consistent with the purpose of classifying burglary as a separate and relatively more serious crime. As commentators have pointed out, burglary is in fact a form of attempt crime, since the crime the unlawful intruder intended to commit need not be completed. The development of burglary as an independent felony resulted from two deficiencies in the early law of attempt: that an attempt could not be penalized until the last act short of completion had occurred, and that the conduct was in any event punishable only as a misdemeanor (see, Denzer and McQuillan, Practice Commentary, McKinney’s Cons Laws of NY, Book 39, Penal Law art 140, at 331-332 [1967]; Model Penal Code and Commentaries, Official Draft and Revised Comments § 221.1, at 62-63).

These gaps in the laws of attempt have now been remedied. An attempt need not encompass the final act toward the completion of the offense (People v Bracey, 41 NY2d 296, 300), and is punishable as an offense of the same grade or a single lesser grade of severity as the completed crime (Penal Law § 110.05). Nonetheless, the Legislature has continued to penalize burglary as a serious felony — rather than simply punish the trespass and the attempted or consummated crime within a building — because of the heightened danger posed when an unlawful intrusion into a building is effected by someone bent on a criminal end. A defendant who simply trespasses with no intent to commit a crime inside a building does not possess the more culpable mental state that justifies punishment as a burglar.

We conclude, therefore, that the Legislature had no such purpose. The statute contains no clear and explicit direction to change the long-standing rule (see, People v King, 61 NY2d 550, 554). To the contrary, the Legislature was plainly addressing a different factual situation — not one of unlawful entry but of unauthorized remaining in a building after lawful entry (as a shoplifter who remains on store premises after closing). As we observed in People v Licata (28 NY2d 113), " '[t]he word "remain” in the phrase "enter or remain” is designed to be applicable to cases in which a person enters with "license or privilege” but remains on the premises after termination of such license or privilege.’ ” (Id., at 117, quoting Denzer and McQuillan, Practice Commentary, op. cit., at 341-342; 2 CJI[NY] PL 140.20; 2 LaFave & Scott, Substantive Criminal Law § 8.13 [b], at 468.) By the words "remains unlawfully” the Legislature sought to broaden the definition of criminal trespass, not to eliminate the requirement that the act constituting criminal trespass be accompanied by contemporaneous intent to commit a crime.

In order to be guilty of burglary for unlawful remaining, a defendant must have entered legally, but remain for the purpose of committing a crime after authorization to be on the premises terminates. And in order to be guilty of burglary for unlawful entry, a defendant must have had the intent to commit a crime at the time of entry. In either event, contemporaneous intent is required.

The trial court committed error in denying defendant’s charge requests. The court should not have referred to unlawful remaining in its burglary charge, since the situation to which that language applies was not present in the case. Most importantly, defendant was entitled to a charge clearly stating that the jury must find that he intended to commit a crime at the time he entered the premises unlawfully.

Failure to give such an instruction compels reversal in this case. The jury could have concluded from defendant’s testimony that he intended no crime when he broke into the building. Notably, by their specific questions, the jurors indicated that they had focused upon the time defendant’s criminal intent was formed, in the correct belief that it should be determinative of whether defendant had committed a trespass or a burglary. However, the charge given by the court could have misled the jurors into thinking that any illegal entry constituted a burglary when coupled with a subsequent crime, and it was therefore reversible error (see, People v Blacknall, 63 NY2d 912, 914).

In that a new trial is necessary, we do not reach defendant’s additional contention that he was improperly sentenced as a predicate felon because the Mississippi burglary statutes (under which he was previously convicted) lacked an essential element of the analogous New York crime.

Accordingly, the Appellate Division order should be reversed and a new trial ordered.

Chief Judge Wachtler and Judges Simons, Alexander, Titone, Hancock, Jr., and Bellacosa concur.

Order reversed, etc.

      . This is not to suggest, however, that the People are required to prove that defendant intended to commit any particular crime within a building. Moreover, defendant’s intent to commit a crime may be inferred from the circumstances of the entry, under a proper instruction (see, People v Barnes, 50 NY2d 375, 381).

      . New York’s pattern criminal jury instructions place the word "remains” in brackets, indicating that the defendant has either entered or remained unlawfully, but not both (see, 2 CJI[NY] PL 140.20).


author: Per Curiam.

text:
    In the Matter of Edward J. Kiley, a Judge of the District Court of Suffolk County, Petitioner. State Commission on Judicial Conduct, Respondent.
    Argued September 6, 1989;
    decided October 24, 1989

      POINTS OF COUNSEL

      Nathan R. Sobel for petitioner.
    The Commission’s determined sanction of removal should be rejected; charges 2, 3 and 4 should be dismissed and such other sanction as this court finds fair and just should be imposed with regard to charge 1. (Matter of Lonschein, 50 NY2d 569; Friedman v State of New York, 24 NY2d 528.)

      Gerald Stern and Robert H. Tembeckjian for respondent.
    I. Petitioner engaged in egregious misconduct by seeking special consideration on behalf of two defendants in criminal cases. (Matter of Dixon v State Commn. on Judicial Conduct, 47 NY2d 523; Matter of Seiffert, 65 NY2d 278; Matter of Fabrizio, 65 NY2d 275.) II. Petitioner’s misconduct is exacerbated by his lack of candor and failure to appreciate the nature of his wrongdoing. (Matter of Steinberg, 51 NY2d 74; Matter of Gelfand, 70 NY2d 211; Matter of Waltemade, 37 NY2d [a]; Matter of Sims, 61 NY2d 349; Matter of Shilling, 51 NY2d 397.) III. Petitioner’s egregious misconduct, lack of candor and failure to recognize his wrongdoing compel his removal from office.
   OPINION OF THE COURT

Per Curiam.

In this proceeding we are called upon to review a determination of the State Commission on Judicial Conduct removing from office the petitioner, a Judge of the Suffolk County District Court, for certain acts of judicial misconduct. After having reviewed all of the evidence before the Commission, we conclude that censure, rather than removal, is the appropriate sanction.

On May 10, 1988, the Commission served a complaint upon petitioner containing four charges of misconduct. The charges alleged that in October and November 1987, petitioner interceded on behalf of the defendants in two criminal proceedings, lent and appeared to lend the prestige of his judicial office to advance their private interests, and failed to disqualify himself from one of the proceedings. Petitioner was specifically charged with having initiated several ex parte communications with the prosecutors, in People v Matthew Begg, and with the Judge and prosecutor in People v John Hopkins Jr., for the purpose of seeking lenient treatment for the defendants (charges 1 & 3). Petitioner was also charged with giving testimony which was lacking in candor in 15 specified instances during the Commission’s investigation (charges 2 & 4). In its determination dated April 3, 1989, the Commission sustained charges 1 and 3 in toto, charge 2 in part, and dismissed charge 4 concluding that petitioner violated sections 100.1, 100.2, 100.3 (a) (1), 100.3 (a) (4), 100.3 (c) (1) and 100.3 (c) (1) (i) of the Rules Governing Judicial Conduct (22 NYCRR), and Canons 1, 2, 3A (1), 3A (4), 3C (1) and 3C (1) (a) of the Code of Judicial Conduct. We now review the determination upon petitioner’s request (Judiciary Law § 44 [7], [9]).

I.

The Hopkins Case

Petitioner received a call from John Hopkins Sr., a close family friend, who informed petitioner that Hopkins’ son, John Jr., had been arrested for armed robbery. Petitioner had known the Hopkins family for approximately 12 years and was aware that the family had recently suffered a series of tragedies. Specifically, the overdose death of one son, and the death, during childbirth, of another son’s paramour, leaving the senior Hopkins to care for a two year old, and a pair of infant twins, one of whom was born severely brain damaged. Petitioner informed Hopkins that he would be in the courthouse when Hopkins Jr. would be arraigned.

Prior to arraignment, petitioner approached the Assistant District Attorney (A.D.A.) who was handling the case, and told him that he had represented the defendant in the past and that the defendant had a good record of appearing in court as scheduled. Petitioner also informed the A.D.A. of the recent tragedies that had befallen the defendant’s family. Petitioner then stopped at the chambers of the Judge assigned to the case, and informed the Judge of the same facts and circumstances.

The Begg Case

Petitioner, a former New York City police officer, attended a reunion of officers from his former precinct. At the reunion, one of petitioner’s friends told petitioner that the son of another retired officer named Begg had a "problem” of unspecified nature in the Suffolk County courts. Petitioner subsequently discovered that the Begg case, which involved criminal trespass, had been assigned to him.

When People v Begg appeared on petitioner’s docket sheet, petitioner summoned the A.D.A. into his chambers, and inquired as to why he was not offering to dispose of this minor trespass case with an adjournment in contemplation of dismissal (ACOD). The A.D.A. explained that an ACOD disposition would contravene his office’s policy because there had been repeated problems with youths on the property in question. Petitioner then summoned the A.D.A.’s supervisor, disclosed to both prosecutors that he would like an ACOD in this case because the defendant’s father was a police officer with whom petitioner had once worked, and stated that an ACOD would be "appreciated.” When the supervisor informed petitioner that the ACOD would not be possible, petitioner responded that that was okay. The three then returned to the courtroom. Even though the case was scheduled for trial before another Judge, petitioner did not disqualify himself from the case, nor disclose on the record that he had had a conversation with a friend concerning the case.

II.

Initially we note that we are empowered to "review the commission’s findings of fact and conclusions of law” as well as to "impose a less or more severe sanction” than imposed by the Commission (NY Const, art VI, § 22 [d]; Matter of Spector, 47 NY2d 462). Upon full factual review of the evidence adduced before the Referee (NY Const, art VI, § 22 [d]; Judiciary Law §44 [9]), we find the allegations contained in charges 1 and 3 sustained by the evidence. We also agree that charge 4 should be dismissed in toto. We conclude, however, that charge 2 should also be dismissed in toto since the evidence adduced by the Commission fails to sustain a lack of candor charge.

Petitioner acted improperly in both the Hopkins and Begg cases because he lent and appeared to lend the prestige of his office to advance the respective defendant’s private interests. Although petitioner was initially charged with 10 specified instances of lack of candor surrounding his discussions with both the A.D.A. and the arraigning Judge in the Hopkins case, the Commission sustained only a part of one specification of that charge finding petitioner to be "evasive and less than forthcoming” in failing to admit that one of the motivations underlying his discussions with the Judge and prosecutor was to have a relatively low bail imposed on Hopkins. We disagree with this conclusion.

Importantly, neither the Commission nor the Referee made any finding that petitioner discussed the amount of bail with either the A.D.A. or the arraigning Judge. In addition, there is no other independent, objective evidence indicating that petitioner’s statement of his intentions was false. There exists merely a disagreement concerning petitioner’s intent or purpose — whether petitioner’s goal was simply to provide information or to cast favor on defendant as a bail risk. While the fact that petitioner discussed background information with the arraigning Judge and the A.D.A. resulted in the objective appearance that he intended to influence the bail disposition, we cannot conclude, solely on the basis of the fact that the discussions occurred, that petitioner dissembled at the hearing when he refused to admit that his subjective intention was to influence the bail disposition (but see, Matter of Gelfand, 70 NY2d 211, 215 [petitioner lacked candor as to both motivations and many background incidents]; Matter of McGee, Commn on Jud Conduct, Apr. 12, 1984 [petitioner’s claim that he intended only to ascertain amount of bail rather than recommend low bail or release belied by objective proof where both arraigning Judge and prosecutor testified otherwise]).

Finally, we agree with the Referee’s finding, adopted by the Commission, that the remaining nine instances of alleged lack of candor in charge 2, and the five alleged instances in charge 4, are nothing more than a mere lack of recall on the part of petitioner. Thus charge 4 was rightly dismissed. In addition, we note that minor discrepancies in factual testimony, which may result from an honest difference in recollection, do not necessarily constitute a lack of candor.

III.

Although we find that the record does support a finding of misconduct, we cannot agree with the Commission’s conclusion that petitioner’s misconduct warrants the sanction of removal. We have repeatedly noted that removal is the ultimate sanction and should be imposed only in the event of truly egregious circumstances (Matter of Steinberg, 51 NY2d 74, 83; see, Matter of Cunningham, 57 NY2d 270, 275). Indeed, removal is not warranted for conduct that amounts simply to poor judgment or even extremely poor judgment (Matter of Shilling, 51 NY2d 397, 403, citing Matter of Steinberg, supra, at 81; see, Matter of Cunningham, supra). Although petitioner’s conduct amounts to extremely poor judgment, removal is not appropriate under the circumstances of this case.

While we do not condone petitioner’s conduct, we do note that his involvement in the Hopkins matter was motivated by his sympathy for the plight of the Hopkins family, and that petitioner sought only to help his friends through another emotional trauma. Petitioner was not motivated by personal gain, and totally absent from his conduct was any element of venality, selfish or dishonorable purpose (see, Matter of Lonschein, 50 NY2d 569, 573). While no similar mitigating factors inhere in petitioner’s actions in the Begg case, there likewise are no aggravating factors and thus a sufficient basis for removal is lacking (compare, Matter of Edwards, 67 NY2d 153; Matter of Dier, 48 NY2d 874; Matter of Bulger, 48 NY2d 32; Matter of Dixon, 47 NY2d 523; Matter of McM. Wright, Commn on Jud Conduct, June 20, 1988; Matter of Watson, Commn on Jud Conduct, Nov. 17, 1988; Matter of McGee, supra; Matter of De Luca, Commn on Jud Conduct, July 2, 1984; with, Matter of Conti, 70 NY2d 416; Matter of Myers, 67 NY2d 550; Matter of Seiffert, 65 NY2d 278; Matter of Reedy, 64 NY2d 299).

As justification for removal, the Commission relied on petitioner’s alleged lack of candor in the Hopkins investigation. In addition to disagreeing with the Commission’s conclusion that petitioner lacked candor, we find the Commission’s reliance on this factor, in the circumstances presented, particularly troubling. In prior cases, we have accepted the use of this factor as a reason for the severest penalty where the Judge who was to be sanctioned gave patently false explanations to the Commission despite contrary objective proof (see, Matter of Conti, supra, at 418-419; Matter of Gelfand, supra, at 215; cf., Matter of Levine, 74 NY2d 294 [falsely denied to F.B.I. investigators ability to recall subject matter of a conversation]). Nonetheless, we do not condone "lack of candor” as an aggravating factor if it unfairly deprives an investigated Judge of the opportunity to advance a legitimate defense.

Judges facing misconduct investigations are in the unenviable position of having to choose between speaking with Commission representatives and refusing to speak. If they choose the latter course, they risk being charged with "failure to cooperate” as an aggravating factor for the imposed sanction (see, e.g., Matter of Cooley, 53 NY2d 64). On the other hand, if they cooperate by speaking to Commission investigators or testifying at their own hearings, they run the risk of provoking "lack of candor” charges based upon inadvertent factual misstatements, testimonial inconsistencies or even poor judgment in responding to searching, unanticipated questions. If a Judge has acted with extremely poor judgment but not necessarily with a particular subjective intention which the Commission would like to attribute to him or her, the Judge can either admit an intention that he or she did not possess, or truthfully deny the intention and yet face an additional charge of lack of candor. This result is both undesirable and unnecessary. While a Judge’s dishonesty or evasiveness before Commission investigators is not to be condoned, the use of a Judge’s "lack of candor” as an aggravating circumstance should be approached cautiously to minimize the risk that the investigative process itself will be used to generate more serious sanctions.

Accordingly, the determined sanction should be rejected, without costs, and the sanction of censure imposed.

Chief Judge Wachtler and Judges Simons, Kaye, Alexander, Titone, Hancock, Jr., and Bellacosa concur in Per Curiam opinion.

Determined sanction rejected, etc.


text:
    Albany Area Builders Association et al., Respondents, v Town of Guilderland, Appellant.
    Argued September 12, 1989;
    decided October 26, 1989

      POINTS OF COUNSEL

      Kenneth D. Runion for appellant.
    I. The impact fee law is authorized pursuant to the Municipal Home Rule Law. (Matter of Golden v Planning Bd., 30 NY2d 359; Matter of Sherman v Frazier, 84 AD2d 401; Lighthouse Shores v Town of Islip, 41 NY2d 7; Baldwin v City of Buffalo, 6 NY2d 168; French Investing Co. v City of New York, 39 NY2d 587; Matter of Torsoe Bros. Constr. Corp. v Board of Trustees, 81 Misc 2d 702, 49 AD2d 461; 41 Kew Gardens Rd. Assocs. v Tyburski, 70 NY2d 325.) II. The transportation impact fee is not a tax. (Jenad, Inc. v Village of Scarsdale, 18 NY2d 78.) III. The Transportation Impact Fee Law is not inconsistent with nor preempted by general laws regulating highway funding and municipal finance.

      James T. Potter and Kirk M. Lewis for respondents.
    I. The Town has no authority to enact the Transportation Impact Fee Law. (City of New York v Village of Lawrence, 250 NY 429; Matter of McAneny v Board of Estimate & Apportionment, 232 NY 377; Good Humor Corp. v City of New York, 264 App Div 620, 290 NY 312; FGL & L Prop. Corp. v City of Rye, 66 NY2d 111; Matter of Allen v Adami, 39 NY2d 275; Matter of 440 E. 102nd St. Corp. v Murdock, 285 NY 298; Matter of City of New York [Piers Old 8, 9, 10, 11], 228 NY 140; Matter of Ocean Beach Ferry Corp. v Incorporated Vil. of Ocean Beach, 298 NY 30; Matter of Quinby v Public Serv. Commn., 223 NY 244; Moriarty v Planning Bd., 119 AD2d 188.) II. The court below properly held that the Transportation Impact Fee Law was preempted by and inconsistent with the Town Law and Highway Law. (Consolidated Edison Co. v Town of Red Hook, 60 NY2d 99; Jancyn Mfg. Corp. v County of Suffolk, 71 NY2d 91; New York State Club Assn. v City of New York, 69 NY2d 211; People v De Jesus, 54 NY2d 465; Robin v Incorporated Vil. of Hempstead, 30 NY2d 347; Riegert Apts. Corp. v Planning Bd., 57 NY2d 206; Matter of Barker v Switzer, 209 App Div 151; FGL & L Prop. Corp. v City of Rye, 66 NY2d 111; Matter of United States Steel Corp. v Gerosa, 7 NY2d 454.)

      A. Kevin Crawford and Donna M. C. Giliberto for the Association of Towns of the State of New York and another, amici curiae.

    I. The Town of Guilderland transportation impact fee on new development is a regulatory land development fee and not a tax. (Matter of Joslin v Regan, 63 AD2d 466, 48 NY2d 746; Matter of Hanson v Griffiths, 204 Misc 736; Church of Christ the King v City of Yonkers, 115 Misc 2d 461; Jewish Reconstructionists Synagogue v Incorporated Vil. of Roslyn Harbor, 40 NY2d 158; Nitkin v Administrator of Health Servs. Admin., 91 Misc 2d 478, 43 NY2d 673; American Sugar Ref. Co. v Waterfront Commn., 55 NY2d 11; People v Board of Managers, 123 Misc 2d 188; Mobil Oil Corp. v Town of Huntington, 85 Misc 2d 800; Gulest Assocs. v Town of Newburgh, 25 Misc 2d 1004, 15 AD2d 815; Jenad, Inc. v Village of Scarsdale, 18 NY2d 78.) II. The Town of Guilderland impact fee is authorized by the Municipal Home Rule Law, statute of local governments and the Town Law. (41 Kew Gardens Rd. Assocs. v Tyburski, 70 NY2d 325; Lighthouse Shores v Town of Islip, 41 NY2d 7; Kessell v Purcell, 119 Misc 2d 449; Adler v Deegan, 251 NY 467; Matter of Golden v Planning Bd., 30 NY2d 359.) III. The Town of Guilderland impact fee law has not been preempted by State legislation.

      Terry Rice for the New York Planning Federation and another, amici curiae.

    I. Impact fees are authorized by the general zoning enabling legislation of the Town Law and Village Law. (Berenson v Town of New Castle, 38 NY2d 102; Delaware Midland Corp. v Incorporated Vil. of Westhampton Beach, 79 Misc 2d 438, 48 AD2d 681, 39 NY2d 1029; Matter of Brous v Smith, 304 NY 164; Matter of Golden v Planning Bd., 30 NY2d 359, 409 US 1003; Collard v Incorporated Vil. of Flower Hill, 52 NY2d 594; FGL & L Prop. Corp. v City of Rye, 66 NY2d 111; Matter of Town of Islip v Caviglia, 73 NY2d 544; Allen v Town of N. Hempstead, 103 AD2d 144; Town of Huntington v Park Shore Country Day Camp, 47 NY2d 61; French Investing Co. v City of New York, 39 NY2d 587.) II. Municipal Home Rule Law zoning authority provides authorization for the adoption of an impact fee local law. (Matter of Sherman v Frazier, 84 AD2d 401; Matter of Schilling v Dunne, 119 AD2d 179; New York State Club Assn. v City of New York, 69 NY2d 211; Weinstein Enters. v Town of Kent, 135 AD2d 625, 72 NY2d 801; North Bay Assocs. v Hope, 116 AD2d 704;
      Albright v Town of Manlius, 34 AD2d 419, 28 NY2d 108; Dun-Bar Realty Co. v City of Utica, 57 AD2d 51, 44 NY2d 1002; Matter of Fox Meadows Estates v Culley, 233 App Div 250, 261 NY 506; Rodgers v Village of Tarrytown, 302 NY 115; Village of Belle Terre v Boraas, 416 US 1.)
   OPINION OF THE COURT

Kaye, J.

The Town Board of defendant Town of Guilderland, a suburban community in Albany County, has projected that its population will increase substantially during the next 20 years, that such an increase will directly and adversely affect the existing transportation network, and that the road system would have to be expanded. The Board further found that current revenue sources were insufficient to fund the necessary capital improvements. On the stated theory that "[n]ew development should contribute its fair share of the costs of providing new facilities necessary to accommodate said new development,” the Board adopted a local law entitled the Transportation Impact Fee Law (TIFL). The validity of that law is the issue before us today.

TIFL provides that applicants for building permits who seek to make a change in land use that will generate additional traffic must pay a transportation "impact fee” when the permit is issued. The size of the fee is determined by a detailed schedule set forth in the law, which assesses fees based on size and use of the proposed development — the intention being to impose on the fee payer only "the fair share cost of improved roadways necessitated by the new development.” Alternatively, the law allows applicants to submit their own fee calculation study, but they must use a methodology prescribed in TIFL and must pay the Town 3% of the fee estimated by the independent study (up to $4,000) for "review and processing the study.”

Limited credits are allowed for roadway improvements. Builders receive no credit, however, for site-related improvements, and the credits are available only as against specific portions of the total impact fee. To obtain the credit, the applicant must present cost estimates and property appraisals prepared by qualified professionals, and post a performance bond or irrevocable letter of credit equal to 110% of the cost of construction. Finally, TIFL provides that all fees collected are to be deposited in a trust fund maintained by the Town, and that the moneys shall be spent only for capital improvement, and for expansion of the roadway network and transportation facilities within the Town. No funds are to be used for routine maintenance.

Plaintiffs — two builders’ associations and three individual building companies — have challenged the Town’s authority to enact TIFL. They urge that the Town was without constitutional or statutory authority to enact TIFL, that impact fees are not permissible land use regulations, and that TIFL is both inconsistent with and preempted by existing State laws. The Town contends that TIFL is a permissible land use regulation authorized by section 10 of the Municipal Home Rule Law. The Appellate Division declared TIFL invalid, concluding that no statutory authority empowered the Town to enact the law, and that it is in any event preempted by the general laws regulating the funding of roadway improvements. We granted leave to appeal, and now affirm on the second ground.

It is a familiar principle that the lawmaking authority of a municipal corporation, which is a political subdivision of the State, can be exercised only to the extent it has been delegated by the State. While the Legislature has retained authority in matters of State concern, it has empowered municipalities to legislate in a wide range of matters relating to local concern (see, Kamhi v Town of Yorktown, 74 NY2d 423 [decided today]; New York State Club Assn. v City of New York, 69 NY2d 211, 217, affd 487 US 1). So long as local legislation is not inconsistent with the State Constitution or any general law, localities may adopt local laws both with respect to their "property, affairs or government” (see, NY Const, art IX, § 2 [c] [i]; Municipal Home Rule Law § 10 [1] [i]), and with respect to other enumerated subjects, except "to the extent that the legislature shall restrict the adoption of such a local law”. (See, NY Const, art IX, § 2 [c] [ii]; Municipal Home Rule Law § 10 [1] [ii].) The Town urges that these home rule powers encompass TIFL.

In support of its position the Town points to provisions of the Municipal Home Rule Law that permit towns to enact local laws that relate to their "property, affairs or government” (§ 10 [1] [i]); to the acquisition, care, management and use of local roads (§ 10 [1] [ii] [a] [6]); to the acquisition, ownership and operation of transit facilities (§ 10 [1] [ii] [a] [7]); to the fixing, levy, collection and administration of local government fees (§ 10 [1] [ii] [a] [9-a]); and to the amendment or supersession, in their local application, of provisions of the Town Law (§ 10 [1] [ii] [d] [3]). We need not decide whether TIFL in fact falls within any of these delegated powers, however, because it is in any event preempted by State law.

The preemption doctrine represents a fundamental limitation on home rule powers (see, Dougal v County of Suffolk, 65 NY2d 668, affg on opn at 102 AD2d 531, 532; 5 McQuillin, Municipal Corporations § 15.20, at 101-104 [3d ed 1989]). While localities have been invested with substantial powers both by affirmative grant and by restriction on State powers in matters of local concern, the overriding limitation of the preemption doctrine embodies "the untrammeled primacy of the Legislature to act * * * with respect to matters of State concern.” (Wambat Realty Corp. v State of New York, 41 NY2d 490, 497.) Preemption applies both in cases of express conflict between local and State law and in cases where the State has evidenced its intent to occupy the field (see, e.g., Matter of Lansdown Entertainment Corp. v New York City Dept. of Consumer Affairs, 74 NY2d 761 [express conflict]; Consolidated Edison Co. v Town of Red Hook, 60 NY2d 99 [intent to occupy the field]).

Where the State has preempted the field, a local law regulating the same subject matter is deemed inconsistent with the State’s transcendent interest, whether or not the terms of the local law actually conflict with a State-wide statute. Such local laws, "were they permitted to operate in a field preempted by State law, would tend to inhibit the operation of the State’s general law and thereby thwart the operation of the State’s overriding policy concerns.” (Jancyn Mfg. Corp. v County of Suffolk, 71 NY2d 91, 97.) Moreover, the Legislature need not express its intent to preempt (New York State Club Assn. v City of New York, supra, at 217). That intent may be implied from the nature of the subject matter being regulated and the purpose and scope of the State legislative scheme, including the need for State-wide uniformity in a given area (see, Robin v Incorporated Vil. of Hempstead, 30 NY2d 347). A comprehensive, detailed statutory scheme, for example, may evidence an intent to preempt.

Applying these principles to the case at hand, we hold that the State Legislature has enacted a comprehensive and detailed regulatory scheme in the field of highway funding, preempting local legislation on that subject. By several provisions of the Town Law and Highway Law, the Legislature has evidenced its decision to regulate how roadway improvements are budgeted, how these improvements are financed, and how moneys for these improvements are to be expended.

With respect to the budget process, article 8 of the Town Law establishes an elaborate "budget system” (Town Law § 102), which delineates how towns are to budget for improvements and repairs to highways (see, Matter of Petito v O’Keefe, 52 Misc 2d 28, 30, affd 26 AD2d 991, lv denied 18 NY2d 583). Under that system, which requires disclosure of sources of revenue and proposed expenditures, towns are held accountable for public funds (see, e.g., Town Law §§ 107, 108 and 109 [requiring preparation and disclosure of preliminary and final budgets and public hearings]). Indeed, Highway Law § 141, together with Town Law § 104, mandates that prior to the preparation of a town budget, the town superintendent submit an estimate showing the amount to be raised by taxation for the construction, improvement, maintenance and repair of town highways.

The Legislature has also explicitly limited the amount a town can raise by taxation for highway purposes (see generally, Matter of Flike v Strobel, 252 App Div 35, 37). Town Law § 107 (3) provides that amounts to be raised by tax for highway purposes must be within the limitations of the Highway Law. Section 271 of the Highway Law, in turn, provides detailed restrictions on the amounts to be raised for improvements to highways, with varying limits depending on the town and the purpose of the improvement.

The manner in which funds are expended is also closely regulated by the Highway Law (see, Myruski v Town Bd., 87 Misc 2d 1063; Matter of Carlisle v Burke, 82 Misc 282; 14 Opns St Comp No. 58-184, at 72). Sections 284 through 285-a detail how funds are to be expended, requiring a written agreement between the town board, the town superintendent of highways, and the county superintendent of highways; funds for highway improvements may be paid out only "on vouchers approved by the town superintendent in accordance with such written agreement.” (Highway Law § 284.)

These provisions of State law, which safeguard the public fisc, "are grounded in the general principles of fiscal responsibility and the accountability that underpins the regulation of all public conduct”. (Matter of Korn v Gulotta, 72 NY2d 363, 373; Coggeshall v Hennessey, 279 NY 438; see also, 14 Opns St Comp No. 58-184, at 72.) The purpose, number and specificity of these statutes make clear that the State perceived no real distinction between the particular needs of any one locality and other parts of the State with respect to the funding of roadway improvements, and thus created a uniform scheme to regulate this subject matter (see, People v De Jesus, 54 NY2d 465, 468).

It is equally manifest that TIFL intrudes on the legislative scheme in at least two significant respects. First, because TIFL directs moneys be paid into a separate fund, those moneys may escape the budgetary process established to regulate highway funding. Second, TIFL allows towns to evade statutory requirements for budgeting, accounting for revenues and documenting expenditures. In contrast to these directives, TIFL merely provides for payment into a trust fund, with funds to be used "for the purpose of capital improvements.” Thus, as the Appellate Division correctly observed: "Permitting towns to raise revenues with impact fees would allow towns to circumvent the statutory restrictions on how money is raised and, further, would permit towns to create a fund of money subject to limited accountability, not subject to the statutory requirements governing how funds for highway improvements are spent.” (141 AD2d 293, 300 [citations omitted].)

We therefore conclude that the State has evidenced a purpose and design to preempt the subject of roadway funding and occupy the entire field, so as to prohibit additional local regulation.

In that TIFL is preempted by State law, we need not reach the controversial question propounded by the parties and amici — whether local "impact fees” are permitted by statute, a question that has been the subject of considerable comment and litigation in other jurisdictions.

Accordingly, the order of the Appellate Division should be affirmed, with costs.

Chief Judge Wachtler and Judges Simons, Alexander, Titone, Hancock, Jr., and Bellacosa concur.

Order affirmed, with costs.

      . See generally, Sweeney, The "Impact Fee”, An Exciting and Troublesome Concept, 60 NYSBJ 52 (Oct. 1988); Larsen & Zimet, Impact Fees: Et Tu, Illinois?, 21 J Marshall L Rev 489 (1988); Bauman & Ethier, Development Exactions and Impact Fees: A Survey of American Practices, 50 Law & Contemp Probs 51 (Winter 1987); Nicholas, Impact Exactions: Economic Theory, Practice, and Incidence, 50 Law & Contemp Probs 85 (Winter 1987); Juergensmeyer & Blake, Impact Fees: An Answer to Local Governments’ Capital Funding Dilemma, 9 Fla St UL Rev 415 (1981); Jacobsen & Redding, Impact Taxes: Making Development Pay its Way, 55 NC L Rev 407 (1977).

      . Compare, e.g., New Jersey Bldrs. Assn. v Mayor of Bernards Twp., 108 NJ 223, 528 A2d 555, with Russ Bldg. Partnership v City & County of San Francisco, 188 Cal App 3d 977, 234 Cal Rptr 1, appeal dismissed 484 US 909, 108 S Ct 253; and Call v City of W. Jordan, 606 P2d 217 (Utah).