
    The People of the State of New York ex rel. The New York Central and Hudson River Railroad Company, Respondent, v. Lawson Purdy and Others, as Commissioners of Taxes and Assessments of the City of New York, Appellants. (Taxes of 1914.)
    First Department,
    May 7, 1915.
    Tax — assessment of building under construction in city of New York — statute providing exemption construed — time construction is commenced — excavation for foundation.
    Section 889a of the charter of Greater New York, which provides that “a building in the course of construction commenced since the preceding first day of October and not ready for occupancy shall not be assessed,” should be construed to mean that buildings which have taken less than one year to build, and are completed before October first, are exempt from taxation for that year; that buildings begun after October first, and still uncompleted on the first of the succeeding October, are also exempt; but that buildings begun before October first, and not completed on the first of October following, are assessable.
    The time at which the erection of a building is commenced within the meaning of the statute is the time when any material portion of the work incident to the new building has been begun on the proposed site, including the time when excavation on the ground to receive the foundations or other portions of the structure which are to be placed below the surface has been commenced, with a view to its continuance and completion in due course. The beginning of the statutory period of exemption is not delayed to the time when there is an actual construction of some portion of the building itself.
    Scott, J., and Ietgraham, P. J., dissented, with opinion.
    Appeal by the defendants, Lawson Purdy and others, as commissioners, etc., from an order of the Supreme Court, made at the New York Special Term and entered in the office of the clerk of the county of New York on the 30th day of November, 1914, reducing an assessment for the purposes of taxation and confirming it as reduced.
    
      Curtis A. Peters, for the appellants.
    
      George H. Walker, for the respondent.
   Hotchkiss, J.:

This is a proceeding to review the 1914 assessment for purposes of taxation of the lot of ground covered by the Biltmore Hotel in New York city. The assessment covered both lot and building, and the relator claims that the building was exempt. This claim rests upon section 889a of the Greater New York charter (Laws of 1901, chap. 466, added by Laws of 1913, chap. 324), which provides that a building in course of construction, commenced since the preceding first day of October and not ready for occupancy, shall not be assessed.” The question turns upon whether the building was in course of construction before the 1st day of October, 1912. The premises constitute the westerly portion of the block between Forty-third and Forty-fourth streets, Madison and Vanderbilt avenues. The land assessment was $2,150,000, and for the building and land $5,750,000.

Prior to July, 1912, the work of excavation had been begun, and on and prior to the 1st day of October, 1912, a considerable portion of the excavation ultimately necessary for the foundations of the building structure and for the sidewalk vaults had been completed, although it was not until some time thereafter that any cement or other building material used in and about the foundation work, or any other material entering into the superstructure itself or the grillage sustaining the same, was either delivered upon the premises or set. The building was completed some time between October and December, 1913. There is no finding to the contrary and the evidence justifies the inference that from the time the work of excavation began the building operations continued in due course and without unusual interruption. The interpretation contended for by the relator, and which was adopted by the court below (87 Misc. Rep. 451), is, that within the meaning of the charter, construction of a building has not “ commenced ” until something has been done towards setting in permanent place," or at least bringing to the site with the intention in due course to incorporate it into the work, some of the component parts of the building structure or its foundations. I think this is altogether too narrow an interpretation of the statute and one which foils its purpose. Section 892 of the charter (as amd. by Laws of 1911, chap. 455) provides that the assessment books shall show the sum for which the parcel assessed “would sell if wholly unimproved” and also the sum for which it would sell “with the improvements, if any, thereon.” The latter sum is the value on which the assessment is to be based. It is manifest that in the case of lands on which buildings are in course of construction any attempt to ascertain the increase in sale value of the land due to the presence of an unfinished building would in many cases be exceedingly difficult if not impossible. What, if any, value in the market an uncompleted building would add to the ground value would depend largely on the question of the extent to which the work already done adapted itself to the purposes of the purchaser. To one, the proposed improvement might be wholly undesirable, while to another it might present elements of value sufficient to induce a large bid. But under the most favorable conditions the attempt to value the land plus the improvement might he no easy matter. Where the building operation had progressed but slightly or where it was substantially finished, the task would not be so difficult. But at intermediate stages, where the structure might commonly be found to consist of a mere congeries of parts, it would, in the nature of things, be little more than guess work for any one to say to what extent, if any, they added to the sale value of the land. The evident purpose of the section in question (889a) was to strike an average; to fix a reasonable time for the building operation to proceed toward completion and give to the property owner the benefit of a total exemption during this period of construction and thereafter to assess the full value of the improvement in the condition it might then be found. To define and determine this period by any fractional or other description of the completed work, as one-quarter or one-half thereof, would be too vague for practical purposes and but an invitation to interminable disputes. ' The draftsmen of the section accordingly adopted an arbitrary period of one year which they made applicable in all cases where building operations were in progress. They said to the property owner, during this period your improvement whatever may be its stage of completion shall be exempt in toto, but thereafter the exemption shall cease. October first is assessment day. If on that day it is found that construction of your building was begun after the first day of the October next preceding and is still unfinished, the assessment shall include nothing on account of your improvement; otherwise the provisions of section 892 shall be effective. The practical working of the exemption is as follows: Buildings which have taken less than one year to build and are completed before October first are exempt for that year. Buildings begun after October first and still uncompleted on the first of the succeeding October are also exempt. But buildings begun before October first, and not completed on the first of the October following are assessable. Exemptions are not favored, and unless the language of the section is so clear and unambiguous that the intention to create an exemption indisputably appears, such construction will not be given to it. (People ex rel. Westchester Fire Ins. Co. v. Davenvort, 91 N. Y. 574.) It is a fact too notorious to be ignored that the modern type of high steel building, with which the most valuable portions of our city are so largely improved and of which the building in question is a type, necessarily requires foundations the excavations for which are very deep, and the cost of which is a material part of the total cost of construction. Also, that the work involved in such excavations in many cases extends over a considerable length of time, as in the present case where it apparently occupied over three months.

I think the statute plainly contemplates that the exemption period should begin from the time when any material portion of the work incident to the new building has been begun on the proposed site, including the time when excavation of the ground to receive the foundations or other portions of the structure which are to be placed below the surface has been commenced, with a view to its continuance and completion in due course, and that it would be entirely outside of the purpose of the statute to allow an owner the benefit of the period during which this preliminary but most essential work was in progress, and construe his period of exemption as beginning only when the actual construction of some portion of the physical thing that subsequently becomes the superstructure had been commenced. In Pusey & Jones v. Pennsylvania Paper Mills (173 Fed. Rep. 634) the question arose under a mechanics’ lien statute, which, in the case of original construction, as between liens thereunder and mortgage or other liens placed prior thereto, was so expressed as to relate back and take effect “ as of the date of the visible commencement, upon the ground, of the work of building the structure or other improvement. ” After referring to the words of the statute as above quoted, the court said (p. 647): “This calls for something of such a marked and substantial character as to attract attention and convey notice that a new structure or improvement has been begun.” Continuing, the court cites cases holding that the following acts were not to be considered as “commencement * * * of the work of building,” to wit, the mere placing of lumber or materials on the ground; the staking out of the building or line of foundations; the clearing of the land of brush and stumps and putting it in a condition to begin work on the building proper; the demolition of an old building or the clearing away of the debris after a fire. The court further said: “ The excavation for the foundation of the new structure is the accepted test of its commencement, to which mechanics’ liens relate * * *. And even this must have so far progressed as to be readily observed. A mere scratching of the ground is not enough. * * * c The removal of the sod, the turning over of the soil, or such other equivocal acts as would not fairly indicate the purpose to build, do not constitute the commencement of the building. To satisfy the law, so much must be done of a permanent character as will apprise observers that building is in progress.’ Jacobus v. Mut. Ben. Life Ins. Co., 27 N. J. Eq. 604.” ' In Brooks v. Lester (36 Md. 65), under a Maryland statute * where the- date of the priority of liens depended upon the date of the “commencement of the building,” the Court of Appeals of Maryland said (p. 70): “What the law means by these terms is, some work and labor on the ground, the effects of which are apparent,' easily seen by everybody, such as beginning to dig the foundation, or work of like description, which every one can readily see and recognize as the commencement of a building. ” These cases are persuasive inasmuch as they construe language similar to that used in the section of the charter now under consideration in a manner consistent with what I conceive to be its plain meaning having regard for the purpose it was intended' to subserve.

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

Clarke and Dowling, JJ., concurred; Ingraham, P. J., and Scott, J., dissented.

Scott, J. (dissenting):

This is a certiorari proceeding instituted to review the 1914 assessment for purposes of taxation of real property in the city of Mew York, known as the Hotel Biltmore, occupying the block bounded by Madison and Vanderbilt avenues, Eorty-third and Forty-fourth streets. The assessment was made as of October 1, 1913, and it is alleged by the relator and has been found by the court at Special Term that the construction of the hotel building had been commenced since the preceding October 1 (1912), and that on October 1, 1913, it was still in process of construction and not yet ready for occupancy. The reduction of the assessment is claimed under section 889a of the Greater New York charter (Laws of 1901, chap. 466, added by Laws of 1913, chap. 324), which reads as follows: “ A building in course of construction, commenced since the preceding first day of October and not ready for occupancy, shall not be assessed.”

The question in controversy is when the construction of the hotel building was commenced within the meaning of the section.

The evidence is that prior to October 1, 1912, the lot was excavated in order to provide for the erection of the building in accordance with the plans already filed in the building department, but that no constructive work was done prior to October 1, 1912, the first work, other than excavation, being on or about November 15, 1912, when concrete was placed for the grilling foundations designed to support the columns of the hotel building. Under these circumstances, when did the construction of the building commence ? In other words, does the preparation of the ground for the building constitute the commencement of the construction of the building ?

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

The particular word to be defined, in the act under consideration, is the word construction ” as applied to a building.

The dictionary definitions of the words “building” and construction,” which have frequently been referred to by the courts are such as to exclude a mere hole in the ground upon which it is intended to erect or construct a building. In Black’s Law Dictionary a building is defined as “A structure or edifice erected by the hand of man, composed of natural materials, as stone or wood, and intended for use or convenience,” citing Truesdell v. Gay (13 Gray, 311); State v. Moore (61 Mo. 276) and Clark v. State (69 Wis. 203). In our own State the word is defined as follows in Rouse v. Catskill & New York Steamboat Co. (59 Hun, 80): “The word ‘ build ’ is derived from the word ‘ bold,’ meaning a dwelling. A building is defined to be ‘a structure of the nature of a house built where it is to stand.’ (Murray’s Dictionary.)

£ As commonly understood, a house for residence, business or public use, or for shelter of animals, or storage of goods.’ (Century Dictionary.) And very generally, though not always, the idea of a habitation for the permanent use of man, or an erection connected with his permanent use, is implied in the word building.’ Bouvier defines the word as £ an edifice erected by art and fixed upon or on the soil, composed of different pieces of stone, brick, marble, wood, or other proper substance, connected together and designed for permanent use in the position in which it is so fixed.’ A building is a part of the land. One would not call a tent a building. ' As said in one case of the word building: £In its broadest sense, it can mean only an erection intended for use and occupation as a habitation, or for some purpose of trade, manufacture, ornament or use, constituting a fabric or edifice, such as a house, a store, a church, a shed.’ (Truesdell v. Gay, 79 Mass. [13 Gray] 311.) ” (See, also, Bouvier’s Law Dictionary; Webster’s "Unabridged Dictionary; Standard Dictionary; 4 Am. & Eng. Ency. of Law [2d ed.], 994, 995.)

So, also, the word “construct” is by the same authorities defined, as is indicated by its Latin derivation, as the act of bringing together and uniting materials so as to create a structure or building. The digging of an excavation within which to erect a structure is not, in my opinion, according to the natural and customary meaning of the words, an act of construction of a building.

When we come to consider the section of the charter under which the exemption is claimed we find that it follows immediately upon a section (§ 889, as amd. by Laws of 1903, chap. 454) which requires the assessors in making up the assessment list to separately state as to each parcel assessed “the sum for which * * * under ordinary circumstances [it] would sell if it were wholly unimproved; and * * * the sum for which * * * the same parcel of real estate would sell with the improvements, if any, thereon. ” In other words, the assessors are to separately estimate the value of the parcel, and the value of the improvement thereon, each being estimated according to the assumed selling value. The purpose of section 889a undoubtedly was to encourage building by extending to a builder a limited exemption from taxation while his building was going on. But for this section it would be the duty of the assessors in valuing a parcel of land occupied by an uncompleted building to estimate something for the partially completed improvement. It was to avoid that injustice, as I consider, that the section was adopted. An excavation in a lot would ordinarily add nothing to the value of the lot to a purchaser unless he desired to erect upon it a building very similar to that for which the excavation had been designed. In many cases it would doubtless detract from the value.

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

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

Ingraham, P. J., concurred.

Order reversed, with costs, writ dismissed and assessment confirmed as levied, with costs. Order to be settled on notice. 
      
      See Penn. Laws of 1901, No. 240, § 13.— [Rep.
     
      
      See Maryland Code, 1860, art. 61, § 15.— [Rep.
     