[73 NJSuper Page 334] The Port of New York Authority (Authority) is a body created by compact between the States of New Jersey and New York, with the approval of the Congress. The Hackensack Water Company (Hackensack) is a privately owned public utility corporation of the State of New Jersey. On June 4, 1959 the Authority instituted suit against Hackensack seeking to recover from defendant the sum of $23,049.04 paid by plaintiff to defendant for relocating certain water mains, valves, hydrants, etc., owned by defendant, which were, prior to the relocation, located in public streets and highways in New Jersey at or adjacent to plaintiff's George Washington Bridge (Bridge) and Lincoln Tunnel (Tunnel). The Bridge and
Tunnel are trans-Hudson vehicular facilities connecting the States of New Jersey and New York.
Plaintiff wrote a letter, dated May 29, 1953, to defendant, setting forth:
"As you are aware, the Port of New York Authority is engaged in the construction of connecting ramps between the George Washington Bridge and the Palisades Interstate Parkway. In order to construct these ramps, it will be necessary to relocate your * * *"
followed by a description of the facilities, then
"In order to make way for these ramps and to provide for the widened toll booth plaza and main approach of the George Washington Bridge, the Port Authority desires and hereby directs you to relocate your facilities as shown on the aforementioned drawings.
The Port Authority will reimburse your company for the cost of these relocations calculated on a time and material basis with application of standard percentages for overhead costs.
This reimbursement of your company by the Port Authority will be made, however, upon the distinct understanding:
1. That if the Port Authority shall, within the time prescribed by law, decide that it was under no legal obligation to do so, it may institute such litigation as it may consider or may be advised is necessary for the purpose of adjudicating the question of its legal obligation, if any, to make such payments, and recovering from your company any and all of the money paid for such reimbursement, without interest, and, further, the execution of this letter agreement and the making of any such payment by the Port Authority or the receipt thereof by your company shall not be deemed or construed as in any manner whatsoever limiting, waiving, prejudicing or affecting the legal rights or defenses, whether statutory, or otherwise, of the Port Authority or of your company, in any manner whatsoever; and
2. That your company will cause to be kept accurate records of the cost of materials furnished and labor performed in connection with such relocation of its above-mentioned facilities, which records will be subject to the inspection of the Port Authority at reasonable times.
If your company is willing to accept reimbursement under the conditions herein stated, will you be good enough to so indicate by signing and returning to the Port Authority the attached duplicate original of this letter.
THE PORT OF NEW YORK AUTHORITY
First Asst. to Executive Director
HACKENSACK WATER COMPANY is willing to accept the reimbursement provided for in the foregoing letter upon the conditions therein stated.