Union Square Park Community v. New York City Department of Parks and Recreation

This case arose when Plaintiff challenged Defendant’s agreement with Chef Driven Market, LLC (“CDM”) permitting CDM to operate a seasonal restaurant in Union Square Park for a term of fifteen years.

In 2012, the New York City Department of Parks and Recreation (“Department”) executed a written “license agreement” with CDM. This agreement allowed CDM to operate a seasonal restaurant every day from 7:00 a.m. until 12:00 a.m. from mid-April to mid-October. However, the Department retained extensive control over CDM’s operation of the restaurant. In addition, the agreement contained a termination clause, which allowed the Department to terminate the agreement at will at any time as long as the reason was not arbitrary or capricious.

Plaintiff challenged the licensing agreement by alleging that the agreement violated the public trust doctrine in two ways. First, the restaurant constituted a non-park purpose and was therefore unlawful absent legislative approval. Second, the licensing agreement constituted a lease, making it an improper alienation of parkland.

The public trust doctrine prohibits a city from converting dedicated parkland to a non-park purpose for an extended period of time absent approval from the state legislature. The court, recognizing that restaurants have long been operated in parks, ruled that a restaurant could constitute a valid park purpose. Further, the court acknowledged that the Department enjoys broad discretion to choose among alternative valid park purposes. Plaintiff’s facts only proved a difference of opinion as to the best use of the park land and not that it was a non-park purpose. Accordingly, the court dismissed Plaintiff’s first claim.

While it is unlawful for the Department to lease parkland without legislative approval, it may execute a license without violating the public trust doctrine. Courts generally view an agreement that reserves the grantor the right to cancel whenever it wishes as a license. The court found that the agreement between CDM and the Department reserved the Department significant control over CDM’s daily operations. Further, the agreement contained a termination clause which allowed the Department to cancel at any time. Because of these elements, the court dismissed Plaintiff’s second claim.
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2014 WL 641518, 2014 N.Y. Slip Op. 01207

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