THE PORT AUTHORITY OF NEW YORK AND NEW JERSEY, Plaintiff-Respondent,
THE PORT AUTHORITY OF NEW YORK AND NEW JERSEY POLICE BENEVOLENT ASSOCIATION, INC., Defendant-Appellant.
March 7, 2019
appeal from Superior Court of New Jersey, Law Division,
Hudson County, Docket No. L-4541-17.
F. Orlando argued the cause for appellant (Murphy Orlando,
LLC, and Law Office of D. John McAusland, attorneys; W.
Michael Murphy, Jr., Jason F. Orland, John W. Bartlett and D.
John McAusland, on the briefs).
K. McGahee argued the cause for respondent (Michael Farbiarz,
General Counsel, Port Authority of New York and New Jersey
Law Department, attorney; Sharon K. McGahee, on the brief).
Judges Simonelli, Whipple and Firko.
The Port Authority Police Benevolent Association, Inc.
(Association) appeals from the February 7, 2018 order of the
trial court vacating an arbitration award in favor of its
member. Although this matter began with an arbitration award
entered pursuant to the collective bargaining agreement
between the Association and plaintiff The Port Authority of
New York and New Jersey (Port Authority), our focus is
whether the Port Authority, as a bi-state public corporate
instrumentality, is subject to New Jersey arbitration law.
For the reasons that follow, we reverse the order of the
trial court and reinstate the arbitration award.
discern the following facts from the record. The Association
and Port Authority are parties to a collective bargaining
agreement known as the Memorandum of Agreement (MOA), which
provides for a multi-step grievance procedure concluding with
binding arbitration. The MOA distinguishes between member
benefits for sick and line-of-duty injury leave. In 2011,
Officer Roy Biederman was working the night shift at John F.
Kennedy International Airport when, during a scheduled break,
he slipped and fell in the shower. Biederman sustained a back
injury that kept him out of work for several weeks. The Port
Authority classified Biederman's absence from work as
sick leave rather than injury in the line of duty. He filed a
grievance, pursuant to the MOA, and the matter was referred
to an arbitrator. The arbitrator decided in Biederman's
favor and, on July 6, 2017, the arbitrator emailed the award
to the parties.
November 3, 2017, the Port Authority filed a complaint and
order to show cause seeking to vacate the arbitrator's
decision. The Port Authority cited N.J.S.A. 2A:23B-23, which
provides the statutory basis upon which an arbitration award
may be vacated, as a basis for the Superior Court to vacate
the award. The Association answered by arguing, pursuant to
N.J.S.A. 2A:24-7, the Port Authority's order to show
cause was time barred because it was not filed within three
months after the award was served. In reply, the Port
Authority argued it was not bound by New Jersey arbitration
law because bi-state entities, like the Port Authority, are
not subject to unilateral state legislation.
argument before the trial judge, the Port Authority argued
New Jersey statutory arbitration law did not apply in actions
brought by the Port Authority and instead sought vacatur
under the common law. The trial judge issued a written
decision that addressed the merits of and reversed the
arbitrator's award. At the conclusion of the opinion, the
trial judge explained, "[t]he time bar in the New Jersey
Arbitration Act does not apply to the arbitration award at
issue." The trial court cited Hess v. Port Authority
Trans-Hudson Corp., 513 U.S. 30, 42 (1994), for the
proposition that "bi[-]state entities created by
compact, however, are not subject to the unilateral control
of any one of the States that compose the federal
system." This appeal followed.
review a motion to vacate an arbitration award, "we owe
no special deference to the trial court's interpretation
of the law and the legal consequences that flow from the
established facts." Yarborough v. State Operated
Sch. Dist. of Newark, 455 N.J.Super. 136, 139 (App. Div.
2018). Indeed, "[a] trial court's interpretation of
the law and the legal consequences that flow from established
facts are not entitled to any special deference."
Manalapan Realty, L.P. v. Twp. Comm. of Manalapan,
140 N.J. 366, 378 (1995).
Port Authority "is not the agency of a single state but
rather a public corporate instrumentality of New Jersey and
New York." Sullivan v. Port Auth. of N.Y. &
N.J., 449 N.J.Super. 276, 284 (App. Div. 2017) (quoting
Bunk v. Port Auth. of N.Y. & N.J., 144 N.J. 176,
184 (1996)); see also hip Heightened Indep. &
Progress, Inc. v. Port Auth. of N.Y. & N.J., 693
F.3d 345, 356-57 (3d Cir. 2012). "Neither state may
unilaterally impose additional duties, powers, or
responsibilities on the Port Authority."
Sullivan, 449 N.J.Super. at 284. The Port Authority
Compact specifically provides the Port Authority's powers
may be altered "by the action of the legislature of
either state concurred in by the legislature of the
other." N.J.S.A. 32:1-8. New Jersey courts interpret
"concurred in" to encompass a broader set of
circumstances than the federal and New York courts.
courts have said, "[t]he corollary of the proposition
that neither state may individually impose its legislative
will on the bi-state agency is that the agency may be made
subject to complementary or parallel state legislation."
Ballinger v. Del. River Port Auth., 172 N.J. 586,
594 (2002) (alteration in original) (quoting E. Paralyzed
Veterans Ass'n, Inc. v. City of Camden, 111 N.J.
389, 400 (1988)); see also Int'l Union of Operating
Eng'rs, Local 68 v. Del. River & Bay Auth., 147
N.J. 433, 445 (1997). "[O]ne compact state's statute
can be applied to the bi-state agency if it is
'substantially similar' to an enactment of the other
state." Santiago v. N.Y. & N.J. Port Auth.,
429 N.J.Super. 150, 157 (App. Div. 2012) (quoting
Ballinger, 172 N.J. at 594). "If the states do
not have complimentary legislation, the court must determine
whether the bi-state agency impliedly consented to unilateral
state regulation." Sullivan, 449 N.J.Super. at
285. "In order to be deemed substantially similar, the
two laws at issue must 'evidence some showing of
agreement.' In other words, the New Jersey and [New York]
legislatures must 'have adopted a substantially similar
policy' that is apparent in their respective
statutes." Ibid. (alteration in original)
(quoting Ballinger, 172 N.J. at 600).
United States Court of Appeals for the Third Circuit and New
York's state courts have required evidence of express
legislative intent before unilateral state legislation can be
found to modify the powers of a bi-state agency. See
Int'l Union of Operating Eng'rs, Local 542 v. Del.
River Joint Toll Bridge Comm'n, 311 F.3d 273, 276-79
(3d Cir. 2002) (reviewing cases from New Jersey, New York,
and federal courts). A court's "role in interpreting
[a] [c]ompact is, therefore, to effectuate the clear intent
of both sovereign states, not to rewrite their agreement or
order relief inconsistent with its express terms."
Id. at 276. When a compact's charter states the
powers and duties of the bi-state agency can only be amended
when both states have "concurred in" the
alteration, both state ...