Friday, May 01, 2015

Appeals court only moderately engaged with effort to overturn DOB approval of Forest City's modular plans

The legal challenge to the New York City Department of Buildings’ (DOB) approval of Forest City Ratner’s Atlantic Yards modular plans—and, by extension, any similar offsite construction in New York—provoked only moderate engagement yesterday from a five-judge panel of the Appellate Division, First Department.

That suggests an uphill path for the appeal by the Mechanical Contractors Association and the Plumbing Foundation of a 2013 lower court decision upholding the DOB's conclusion that modular construction could proceed in a factory using cross-trained workers without the presence of licensed plumbers and fire suppression contractors.

The cross-trained workers, of course, are paid less, and part of why modular construction is supposed to cost less than conventional construction.

(With the first Atlantic Yards tower, the long-stalled B2, cost overruns and disputes over the factory have elongated the timetable and raised the cost. Separate from this lawsuit, in a legal dispute between Forest City Ratner and former partner Skanska, the latter has charged that cross-trained workers aren't up to the job.)

Safety jeopardized?

Beginning the 18-minute argument, Bret Jaffe, representing the appellants, stressed the seeming unfairness of requiring licensed trades workers to perform such crucial work on-site but not in the factory, thus jeopardizing safety.

Justice Barbara Kapnick soon interrupted, noting there was “very strict oversight” at the modular factory. “Doesn’t that take care of the safety concerns?”

No, responded Jaffe. The licensed plumbers at the building site, he contended, could not evaluate the whether the work was properly done at the factory. The DOB, he said, does not have the authority to decide where licensing applies.

A building? A structure?

Justice Rosalyn H. Richter asked Jaffe to respond to the city’s argument that modules built in the factory—components of a future building, with at least two or three needed to form an apartment—are not buildings.

DOB, Jaffe said, “suggests ‘building’ is a term of art. That’s nonsense.”

“You say modular construction is a structure?” asked a quizzical Justice Peter Tom.

“A structure is a broadly defined term,” Jaffe pointed out.

Forest City in legal papers, had noted that a structure, according to the city Administrative Code, is “[t]hat which is built or constructed, including among other things: buildings, stadia, tents, reviewing stands, platforms, stagings, observation towers, radio towers, tanks, trestles, open sheds, fences, and display signs.”

Jaffe said that description did encompass a modular unit, since a building, by definition, is not a finished structure.

Justice Richard Friedman, however, suggested that a modular unit didn’t satisfy the code’s requirement. Indeed, when the lawyer for the DOB got her turn, she noted that all the examples “are completed, are self-sustaining.”

Furthering public safety

Richter pointed to what she called “real issue: how does the interpretation you would like us to adopt further public safety?”

The record, the judge was told by the DOB lawyer, demonstrates “extensive efforts” to oversee quality control during the production process. Beyond that, the city agency deserved deference from the courts, which should not interfere with the decision..

Forest City Ratner attorney Bradley Ruskin said “there’s nothing in the record to support the speculation that this is unsafe.”

“When counsel says there’s no way to check,” Kapnick countered, invoking Jaffe, “it does seem some kind of safety issue.”

“Every step in the factory is approved,” Ruskin said, adding that there’s no discretion for variability from the standard. (Then again, setting the modules didn’t work so well at the site, given the apparent slight deviations from standard.)

Jaffe, given a brief rebuttal, said the issue was whether DOB followed the plain language of the code. “The issue here is entirely about safety,” he said, bringing up the recent episode in which illegal siphoning of gas in the East Village apparently led to a horrific fire.

“The reason rigorous licensing requirements exist,” he added, is to avoid that kind of a problem.

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