The Port Authority of New York and New Jersey v. The Port Authority of New York and New Jersey Police Benevolent Ass’n, 459 N.J. Super. 278 (App. Div. 2019). Today’s decision by Judge Gibbons Whipple focuses on the question of “whether the Port Authority, as a bi-state public corporate instrumentality, is subject to New Jersey arbitration law.” The issue arose in the context of an arbitration of a grievance filed by a member of the defendant union regarding whether his absence from work was to be treated as sick leave or injury in the line of duty. The relevant collective bargaining agreement provided for a multi-step grievance procedure that culminated in arbitration.
The arbitrator ruled for the employee and e-mailed his decision to the parties on July 6, 2017. On November 3, 2017, over three months later, the Port Authority filed a complaint and order to show cause seeking to vacate the arbitrator’s ruling. The union sought dismissal of the case on the grounds that N.J.S.A. 2A:24-7 barred the action, because the Port Authority had not filed its case within three months of the arbitrator’s decision. The Port Authority countered that, as a bi-state agency, it was “not subject to unilateral state legislation.”
The Law Division agreed with the Port Authority and reversed the arbitration award. The union appealed, and today the Appellate Division, applying de novo review, with no deference to the Law Division’s view of the law, reversed that ruling and reinstated the arbitrator’s decision.
Judge Gibbons Whipple noted that our Supreme Court had stated that bi-state agencies “may be made subject to complementary or parallel state legislation.” Thus, if both New Jersey and New York have “adopted a substantially similar policy that is apparent in their respective statutes,” an agency such as the Port Authority is subject to that law.
The Third Circuit and New York’s courts had adopted a different test. Those courts “have required evidence of express legislative intent before unilateral state legislation can be found to modify the powers of a bi-state agency.” The Port Authority argued that the Appellate Division should follow the Third Circuit’s approach.
Judge Gibbons Whipple did not agree. Although construction of interstate compacts is a federal question, nothing prevents state courts from taking a role in enforcing rights. The Appellate Division was thus bound to enforce the “complementary and parallel principle until our Supreme Court or the United States Supreme Court hold otherwise.” The court would not seek “express legislative intent” to bind the Port Authority.
Instead, the panel proceeded to evaluate New Jersey and New York arbitration law to see if they were “complementary and parallel.” Factors in that inquiry “include: (1) the scope of the comparative laws; (2) the filing limitations period; (3) the types of remedies and damages available; and (4) the right to trial by jury.”
Judge Gibbons Whipple concluded that the two statutory regimes were “substantially similar,” so that the Port Authority was subject to New Jersey’s arbitration law, including the three-month limitation for appealing an arbitration award. It did not help the Port Authority that that agency itself had, in prior cases, “invoked N.J.S.A. 2A:24-1 to -11 as grounds to vacate an arbitration award, yet, up and until this point, it did not raise the unilateral state legislation argument currently advanced.”
Because the Port Authority did not bring its suit within three months, its claim was barred. Judge Gibbons Whipple rejected the Port Authority’s argument that the time limit should have been relaxed because the arbitrator served his decision by e-mail. Nothing in any law precluded that, and the Port Authority admitted that it had in fact received the award on July 6, 2017. Its complaint was plainly barred by the three-month limitation.