Kathleen Henry v. New Jersey Transit Corporation ( 2023 )

State of New York OPINION
Court of Appeals This opinion is uncorrected and subject to revision
before publication in the New York Reports.
No. 11
Kathleen Henry,
Respondent,
v.
New Jersey Transit Corporation et
al.,
Appellants,
et al.,
Defendant.
Lawrence McGivney, for appellants.
Brian J. Isaac, for respondent.
Valbona Fetahu, New York Trial Lawyers' Association, amici curiae.
SINGAS, J.:
The question before us is whether we have power to hear this appeal under NY
Constitution article VI, § 3 and CPLR 5601 (b) (1). To answer this threshold issue, we
must consider the jurisdictional nature of interstate sovereign immunity to ascertain
-1-
-2- No. 11
whether defendants’ sovereign immunity defense is exempt from our general preservation
rules. We conclude that a state must preserve its interstate sovereign immunity defense by
raising it before the trial court, and no exception to the general preservation rule applies.
Because defendants asserted their sovereign immunity defense for the first time on appeal
after the United States Supreme Court decided Franchise Tax Bd. of Cal. v Hyatt (587 US
—, 139 S Ct 1485 [2019] [hereinafter Hyatt III]), the argument is unpreserved in this case
and there is no directly involved constitutional question supporting this appeal as of right.
The appeal should therefore be dismissed.
I.
In 2014, plaintiff Kathleen Henry sustained injuries while riding on a bus owned by
defendant New Jersey Transit Corporation and driven by defendant Renaud Pierrelouis
(collectively, NJT) when it collided with a vehicle driven by defendant Chen Nakar1 in the
Lincoln Tunnel. Plaintiff commenced this action in June 2015, seeking to recover for the
injuries she sustained in the accident. Following trial, the jury found in plaintiff’s favor
and awarded her damages. NJT moved pursuant to CPLR 4404 (a) to set aside the verdict
and for a new trial on damages, or to reduce the damages awarded by the jury. Supreme
Court denied NJT’s motion (see 2019 NY Slip Op 31903[U] [Sup Ct, NY County 2019]).
On appeal, relying on the U.S. Supreme Court’s decision in Hyatt III—which was
decided on May 13, 2019, after NJT’s posttrial motion was briefed but before it was
1
Nakar was awarded summary judgment and the action was dismissed as against him
before trial (see Sup Ct, NY County, June 6, 2018, Silvera, J., index No. 156496/2015).
No appeal was taken from that order.
-2-
-3- No. 11
decided—NJT argued for the first time in this litigation that the action should be dismissed
under the doctrine of interstate sovereign immunity. NJT asserted that under Hyatt III,
which overruled prior controlling precedent on the issue (see Nevada v Hall, 440 US 410[1979]), the instant action should be dismissed because New Jersey Transit Corporation,
assertedly an arm of the State of New Jersey, and Pierrelouis, an employee who was acting
within the scope of employment at the time of the accident, did not consent to suit in New
York’s courts. NJT alternatively asserted that the trial court should have ordered a new
trial on damages or reduced the damages award.
The Appellate Division affirmed Supreme Court’s order denying NJT’s posttrial
motions and rejected its new sovereign immunity argument (see 195 AD3d 444 [1st Dept
2021]). The Court held that NJT waived its sovereign immunity defense through its
litigation conduct, reasoning that NJT “did not place plaintiff or the court on notice of the
defense by asserting it in its responsive pleadings, during pretrial litigation, at trial or in its
posttrial motion. Indeed, it raised the issue for the first time on appeal” (id. at 445, citing
Belfand v Petosa, 196 AD3d 60 [1st Dept 2021]). The Court further noted that, “[a]s the
defense pre-dates [Hyatt III], and thus was available at the time [NJT] served its answer,
‘[its] litigation conduct induced substantial reliance on that conduct by plaintiff and our
courts, and is inescapably a clear declaration to have our courts entertain this action’ ” (id.,
quoting Belfand, 196 AD3d at 73).
In July 2021, Supreme Court entered judgment in plaintiff’s favor against NJT. NJT
subsequently filed this appeal as of right from the final judgment seeking to bring up for
review the prior nonfinal Appellate Division order which, according to NJT, directly
-3-
-4- No. 11
involved a substantial constitutional question and necessarily affected the final judgment
(see CPLR 5601 [b] [1]; [d]).
II.
This Court’s power to hear an appeal is limited by New York’s Constitution and, in
civil cases, the CPLR. NJT asserts that its appeal lies pursuant to CPLR 5601 (b) (1),
which permits an appeal as of right “from an order of the appellate division which finally
determines an action where there is directly involved the construction of the constitution of
the state or of the United States” (emphasis added; see NY Const, art VI, § 3 [b] [1]). For
a constitutional question to be directly involved it must, among other things, be preserved
as a question of law (see Matter of Schulz v State of New York, 81 NY2d 336, 344 [1993];
Matter of Shannon B., 70 NY2d 458, 462 [1987]; see also Madireddy v Madireddy, 14
NY3d 765, 765 [2010]). Thus, “the constitutional question on the basis of which the appeal
as of right is taken must have been properly raised in the courts below. Otherwise, . . . the
appeal must be dismissed” (Arthur Karger, Powers of the New York Court of Appeals §
7:4 [3d ed rev, Aug. 2022 update]).2 This is because NY Constitution article VI, § 3 (a)
2
The dissent, without basis, constructs a false narrative in suggesting that a litigant’s failure
to preserve an issue “transmutes it from a question of law to not a question of law”
(dissenting op at 10). It is well settled that an unpreserved issue does not raise a “question
of law” as we have defined that term under our constitutional and statutory system (see
Karger, Powers of the New York Court of Appeals §§ 6:5, 7:4).
-4-
-5- No. 11
limits our “jurisdiction . . . to the review of questions of law,” except in cases not relevant
here (see also CPLR 5501 [b]).3
In general, arguments, including constitutional challenges, are preserved only if
presented at the trial court level (see Matter of McGovern v Mount Pleasant Cent. Sch.
Dist., 25 NY3d 1051, 1053 [2015]; Matter of Barbara C., 64 NY2d 866, 868 [1985]). To
demonstrate that a question of law is preserved for this Court’s review, a party must show
that it “raise[d] the specific argument in Supreme Court and ask[ed] the court to conduct
that analysis in the first instance” (U.S. Bank N.A. v DLJ Mtge. Capital, Inc., 33 NY3d 84,
89 [2019] [internal quotation marks and alterations omitted]). Certain circumstances exist
in which the general preservation requirement does not apply. As relevant here, “[a]
judgment or order issued without subject matter jurisdiction is void, and that defect may
be raised at any time and may not be waived” (Editorial Photocolor Archives v Granger
Collection, 61 NY2d 517, 523 [1984]) because it goes to the “competence” of the court
(Lacks v Lacks, 41 NY2d 71, 75 [1976]; see Matter of Fry v Village of Tarrytown, 89 NY2d
714, 718 [1997]; Karger, Powers of the New York Court of Appeals § 17:5 [“a claim of
lack of subject matter jurisdiction . . . may be raised at any time because a jurisdictional
defect may not be waived”]).
In this case, NJT failed to raise its sovereign immunity argument in Supreme Court
and, thus, that issue is unpreserved. However, NJT argues that a sovereign immunity
3
These settled maxims belie the dissent’s mistaken view that the preservation requirement
is a “[c]laim-processing rule[ ]” or “docket-management tool” (dissenting op at 5, 8).
-5-
-6- No. 11
defense can be raised for the first time on appeal because such a defense, if established,
would deprive New York courts of subject matter jurisdiction over this personal injury
action. Thus, the threshold question for this Court is whether we may entertain this appeal
filed by NJT as of right pursuant to CPLR 5601 (b) (1). This requires us to determine if
NJT’s sovereign immunity argument implicates the subject matter jurisdiction of our state
courts, thereby falling within a narrow exception to the preservation rule. In these unusual
circumstances, we must address that substantive issue to the extent necessary to determine
the procedural question of whether NJT is entitled to an appeal as of right.
III.
Sovereign immunity encompasses three distinct concepts: the immunity that states
enjoy from suits in federal courts, the immunity they enjoy from suits in other states’ courts
(or “interstate sovereign immunity”), and the immunity they enjoy in their own courts.
Only the second is implicated here.
Sovereign immunity derives from the common-law premise that “no suit or action
can be brought against the king, even in civil matters, because no court can have
jurisdiction over him” (1 William Blackstone, Commentaries on the Laws of England at
235 [1765]; see Hyatt III, 587 US at —, 139 S Ct at 1493; see also Glassman v Glassman,
309 NY 436, 440 [1956]). Because “all jurisdiction implies superiority of power,” no
authority could hear a case “unless that court had a power to command the execution of it;
but who . . . shall command the king?” (1 Blackstone at 235). Though the king could never
be haled into court through “compulsion” the king could, upon a “just demand,” consent
to private suit “as a matter of grace” (id. at 236). Sovereign immunity also emanates from
-6-
-7- No. 11
the conceit of “the perfect equality and absolute independence of sovereigns under . . .
international law” (Hyatt III, 587 US at —, 139 S Ct at 1493 [internal quotation marks
omitted]).
“After independence, the States considered themselves fully sovereign nations . . .
with ‘full Power to levy War, conclude Peace, contract Alliances, establish Commerce, and
to do all other Acts and Things which Independent States may of right do’ ” (id., 587 US
at —, 139 S Ct at 1493, quoting Declaration of Independence ¶ 4, 1 US Stat 1, 3 [1776]).
Consistent with pre-independence English common law and prevailing international law,
the states accordingly considered themselves immune from suit (see Alden v Maine, 527
US 706, 713 [1999]).
At the time of the Constitutional Convention, the founders “took as given that States
could not be haled involuntarily before each other’s courts,” seeing as “[i]t is inherent in
the nature of sovereignty not to be amenable to the suit of an individual without its consent”
(Hamilton, Federalist No. 81). Thus, the founders understood that a court could not assert
jurisdiction over a state unless the state “condescended to be a party” (Debates of the
Virginia Convention [June 20, 1788], at 1412, 1414). Nonetheless, the Constitution’s text
was silent as to whether, as a general matter, states acceding to the union would maintain
or give up the sovereign immunity they previously enjoyed as a confederation of states.
The only mention of suits between states and individuals was in article III, § 2, clause 1,
which governs the extent of a federal court’s jurisdiction.
Centuries later, in Nevada v Hall, the Supreme Court held that the Constitution did
not grant states automatic immunity from suit in the courts of another state because the
-7-
-8- No. 11
Constitution is silent on that issue (see generally 440 US 410). The Court instead treated
the issue as keeping with international-law notions of immunity: the decision for one state
to extend immunity to another state in its own courts was a matter of comity for the forum
state to decide (id. at 421, 425). Whether to extend immunity, though, was constrained by
the Constitution’s Full Faith and Credit Clause (see id. at 421-424; see also US Const, art
IV, § 1, cl 1), requiring each state to grant other states the same degree of sovereign
immunity the other state would afford itself in its own courts, unless doing so would violate
the forum state’s public policy (see Hall, 440 US at 422).
In 2019, in Hyatt III, the Supreme Court overruled Hall’s core holding that the
Constitution does not guarantee interstate sovereign immunity. It determined that the
Constitution
“altered the relationships between the States, so that they no
longer relate to each other solely as foreign sovereigns. Each
State’s equal dignity and sovereignty under the Constitution
implies certain constitutional limitations on the sovereignty of
all of its sister States. One such limitation is the inability of
one State to hale another into its courts without the latter’s
consent” (Hyatt III, 587 US at —, 139 S Ct at 1497 [internal
quotation marks, citation, and alteration omitted]).
Hall’s conception of immunity based on principles of comity did not, according to the
Court, reflect the altered relationships among the states under the framework of the
Constitution (see id., 587 US at —, 139 S Ct at 1497-1498) and the pre-ratification
recognition that “States were immune under both the common law and the law of nations”
(id., 587 US at —, 139 S Ct at 1494). The Court thus concluded that “interstate sovereign
immunity is . . . integral to the structure of the Constitution” and “implied as an essential
-8-
-9- No. 11
component of federalism” (id., 587 US at —, 139 S Ct at 1498 [internal quotation marks
omitted]). This holding brought the doctrine of interstate sovereign immunity in line with
other state sovereign immunity concepts, clarifying that all state sovereign immunity
derives from the structure of the Constitution which confirmed and retained pre-ratification
notions of state sovereign immunity “ ‘except as altered by the plan of the Convention or
certain constitutional Amendments’ ” (see id., 587 US at —, 139 S Ct at 1494-1495,
quoting Alden, 527 US at 713). Thus, the Court abandoned Hall’s full-faith-and-credit
framework in favor of granting states a broad right to assert their immunity in any
proceeding brought against them in another state’s courts. Following Hyatt III, one state
may not refuse to respect another state’s properly asserted sovereign immunity defense (see
id., 587 US at —, 139 S Ct at 1492, 1498).
IV.
It is undisputed that NJT raised its sovereign immunity argument for the first time
before the Appellate Division. NJT’s contention that its failure to preserve the claim should
be excused because it could not have known that Hyatt III would be decided merits little
discussion. Hyatt III did not create the interstate sovereign immunity doctrine, and NJT
could have raised a general sovereign immunity argument at any point before the trial court
(see Belfand, 196 AD3d at 72-73). Further, even before Hyatt III was decided, the Supreme
Court made clear in April 2016 that it was “equally divided” on the issue eventually
resolved in Hyatt III (Franchise Tax Bd. of Cal. v Hyatt, 578 US 171, 173 [2016] [Hyatt
II]). In any event, Hyatt III was decided before Supreme Court resolved NJT’s posttrial
motions, but NJT took no action before that court asking for dismissal on sovereign
-9-
- 10 - No. 11
immunity grounds. In short, NJT could have asserted its sovereign immunity defense at
Supreme Court, and Hyatt III’s timing does not excuse NJT from its failure to do so.
NJT’s thornier argument is that its sovereign immunity defense may be raised at any
time because that doctrine goes to the subject matter jurisdiction of the New York courts
to entertain this action. As explained above, we have held that a claim that the courts below
lack subject matter jurisdiction need not be preserved (see Cappiello v Cappiello, 66 NY2d
107, 108 [1985]; Editorial Photocolor Archives, 61 NY2d at 523). However, the interstate
sovereign immunity that NJT seeks to assert here presents no such exception.
Subject matter jurisdiction is a “power to adjudge concerning the general question
involved” in litigation, and “is not dependent upon the state of facts which may appear in
a particular case” (Hunt v Hunt, 72 NY 217, 229 [1878]). “ ‘The question of subject matter
jurisdiction is a question of judicial power: whether the court has the power, conferred by
the Constitution or statute, to entertain the case before it’ ” (Matter of Ballard v HSBC
Bank USA, 6 NY3d 658, 663 [2006], quoting Matter of Fry, 89 NY2d at 718). It “cannot
be dispensed with by litigants” because litigants cannot expand a court’s power by consent
or agreement (Shea v Export S.S. Corp., 253 NY 17, 21 [1930]; see Union Pacific R. Co. v
Locomotive Engineers, 558 US 67, 81 [2009] [“Subject-matter jurisdiction properly
comprehended . . . refers to a tribunal’s power to hear a case” and “can never be forfeited
or waived” (internal quotation marks omitted)]).
Personal jurisdiction is a different concept that refers to a court’s power to exert
legal authority over specific parties (see Reed v Chilson, 142 NY 152, 155-156 [1894]; see
also Keane v Kamin, 94 NY2d 263, 265 [1999]). An objection to personal jurisdiction may
- 10 -
- 11 - No. 11
be forfeited by a party’s failure to timely assert it or expressly waived, such as when a party
consents to a tribunal’s authority to adjudicate the merits of a dispute (see CPLR 3211 [e];
Addesso v Shemtob, 70 NY2d 689, 690 [1987]). When a personal jurisdiction defense is
properly asserted, a court must determine whether it may exercise such jurisdiction under
our long-arm statute and the New York and federal constitutions. A state court may
constitutionally exercise personal jurisdiction over a party when that party is generally
“amenable to suit” because it is “essentially at home” in the state (Daimler AG v Bauman,
571 US 117, 125, 127 [2014] [internal quotation marks omitted]) or “should reasonably
anticipate being haled into court” because of its contacts with the state (State of New York
v Vayu, Inc. 39 NY3d —, 2023 NY Slip Op 00801, *4 [2023] [internal quotation marks
omitted]).
Hyatt III accepted that interstate sovereign immunity is waivable based on litigation
conduct (see Hyatt III, 587 US at —, 139 S Ct at 1491 n 1; cf. Aboujdid v Singapore
Airlines, 67 NY2d 450, 454, 459 [1986]).4 Arguments or defenses that are waivable are
generally subject to our preservation rule. The Supreme Court’s determination that
interstate sovereign immunity is waivable fatally undermines NJT’s argument that
interstate sovereign immunity is rooted in subject matter jurisdiction because subject matter
jurisdiction, as a rule, “cannot be dispensed with by litigants” (Shea, 253 NY at 21) and
4
Drifting far afield from the issues needed to resolve this matter—even under its view of
this case—the dissent proposes additional methods by which NJT might have waived its
sovereign immunity defense, conflating principles of forfeiture, waiver, and consent to
personal jurisdiction (see e.g. dissenting op at 24). We limit our discussion to waiver by
litigation conduct as that principle informs the threshold preservation issue.
- 11 -
- 12 - No. 11
“can never be forfeited or waived” (Union Pacific R. Co., 558 US at 81 [internal quotation
marks omitted]). Interstate sovereign immunity’s waivability vitiates any legal
justification for applying a broad exception to the general preservation requirement to such
sovereign immunity claims.5
The history and nature of interstate sovereign immunity guide us to the conclusion
that the doctrine more closely aligns with jurisdiction over a party, rather than over all
subject matter concerning that party. In particular, interstate sovereign immunity is rooted
and analyzed in terms of concepts such as a court’s power over a party, a state’s amenability
to suit, its consent to be sued, and haling a party into court—all of which align closely with
treatment of personal jurisdiction issues, not subject matter jurisdiction ones (see Hyatt III,
587 US at —, 139 S Ct at 1493, citing James E. Pfander, Rethinking the Supreme Court’s
Original Jurisdiction in State-Party Cases, 82 Cal L Rev 555, 581-588 [1994] and Caleb
Nelson, Sovereign Immunity as a Doctrine of Personal Jurisdiction, 115 Harv L Rev 1559,
1574-1579 [2002]). As such, interstate sovereign immunity defenses do not fall within the
subject-matter-jurisdiction exception to the general preservation requirement discussed
above.
The cases that NJT cites concerning the State of New York’s ability to raise
sovereign immunity for the first time on appeal in Court of Claims matters do not require
5
Similarly, while a court typically must raise a lack of subject matter jurisdiction on its
own motion (see Insurance Corp. of Ireland v Compagnie des Bauxites de Guinee, 456 US
694, 702 [1982]; Matter of Fry, 89 NY2d at 718), a federal court need not raise the
sovereign immunity “defect on its own. Unless the State raises the matter, a court can
ignore it” (Wisconsin Dept. of Corrections v Schacht, 524 US 381, 389 [1998]).
- 12 -
- 13 - No. 11
a different result. Unlike our state Supreme Court, the Court of Claims has limited
jurisdiction as defined in the Court of Claims Act, and New York has statutorily waived
sovereign immunity only for causes of action falling with the Act’s parameters (see Court
of Claims Act § 8; Ferreira v City of Binghamton, 38 NY3d 298, 307 [2022]). It is thus
the scope of the Court of Claims Act, rather than sovereign immunity, that limits the Court
of Claims’ subject matter jurisdiction—the two concepts just happen to be coextensive in
that context because of the statutory scheme. Here there is no similar statutory limitation
on the ability of New York courts to hear disputes involving another state.
V.
Given that NJT’s sovereign immunity argument is unpreserved and does not qualify
for any exception to the preservation requirement, an appeal as of right does not lie under
CPLR 5601 (b) (1). As our analysis demonstrates, the threshold question is whether NJT’s
sovereign immunity argument qualifies for an exception to the preservation requirement.6
Nonetheless, the preservation issue itself, like the merits of NJT’s sovereign immunity
claim,7 is not directly involved because the Appellate Division did not address the issue
6
Of course, in addition to appealing as of right under CPLR 5601 (b) (1), NJT could have
moved for leave to appeal from the Appellate Division order, arguing that the preservation
issue merited this Court’s review (see CPLR 5602 [a]; see e.g. Matter of Schulz, 81 NY2d
at 344; Matter of Shannon B., 70 NY2d at 462). Indeed, following dismissal of this appeal,
NJT could still move for leave to appeal (see CPLR 5514 [a]), though we have now
resolved the issue that would be reviewable if we granted that motion.
7
The Appellate Division, which has interest of justice jurisdiction, had the power to review
whether, by its conduct, NJT waived its sovereign immunity argument without first
addressing NJT’s failure to properly preserve that defense in Supreme Court (see U.S. Bank
N.A., 33 NY3d at 89; Hecker v State of New York, 20 NY3d 1087, 1087 [2013]). While
lack of preservation and waiver by litigation conduct each may hinder review of a litigant’s
- 13 -
- 14 - No. 11
and, thus, it was not “decisive of the Appellate Division’s determination” (Karger, Powers
of the New York Court of Appeals § 7:8). Because no constitutional question is preserved
and, thus, directly involved in this appeal as of right, the Court must dismiss it (see NY
Const, art VI, § 3 [b] [1]; CPLR 5601 [b] [1]; see also Matter of Schulz, 81 NY2d at 344;
Matter of Shannon B., 70 NY2d at 462). An unpreserved issue, not subject to any
preservation exception, may not be the predicate for an appeal as of right under CPLR 5601
(b) (1).8
Accordingly, the appeal should be dismissed, without costs, upon the ground that
no substantial constitutional question is directly involved.
argument on the merits, they are different legal doctrines governed by distinct rules and
bodies of precedent.
8
These constraints are critical to maintaining this Court’s proper role in the state
constitutional design. Whether an appeal as of right lies to this Court in a certain case is a
matter of state, not federal, law. In dismissing this appeal, we simply apply that well-
settled and frequently-invoked law to the facts presented.
- 14 -
WILSON, J. (dissenting):
The majority begins by advising that “[t]he question before us is whether we have
the power to hear this appeal under NY Constitution article VI, § 3” (majority op at 1).
Yet, after a lengthy exegesis of significant constitutional issues dating back to Blackstone
and our nation’s founding, the majority concludes that “no substantial constitutional
question is directly involved” in this case (majority op at 14). The majority’s explanation
for the incongruity is that because the defendant, New Jersey Transit (NJT), did not
preserve its argument that it was entitled to sovereign immunity under Franchise Tax Bd.
of Cal. v Hyatt (139 S Ct 1485 [2019] [hereinafter Hyatt III]), our preservation doctrine—
-1-
-2- No. 11
which it also claims is “not directly involved” in the case (see majority op at 13)—trumps
NJT’s sovereign immunity claim, meaning no constitutional issue is present. The majority
does not say that NJT’s failure to preserve a sovereign immunity argument itself constituted
a waiver of sovereign immunity (see majority op at 13-14 n 7). Rather, it states that we do
not need to consider the argument at all—NJT may, according to the majority, be unable
to enforce a perfectly good sovereign immunity defense that it did not waive according to
the waiver rules set by the Federal Constitution. That position is inconsistent not only with
federal jurisprudence on jurisdiction, but also our own case law on preservation.
Turning to something more straightforward, Kathleen Henry was injured in New
York when the NJT bus on which she was riding collided with a car. Buses, trains, and
ferries operated by NJT transport more than a hundred thousand passengers into and out of
New York City each day. NJT says that the Federal Constitution forbids the courts of New
York from hearing any claim caused by its buses or trains when operating in New York.
According to NJT, if one of its buses hits a New York pedestrian standing on a New York
City sidewalk, the Federal Constitution bars the injured pedestrian from suing NJT in the
courts of New York. Even if that pedestrian had never set foot in New Jersey, the only
place in which suit could be brought would be in New Jersey, and only to the degree New
Jersey decided, in its sole discretion, to allow such suits. Ms. Henry says she can sue NJT
in the state in which she was injured, New York.
The majority does not opine on that dispute. The majority does not even opine on
the Appellate Division’s holding that NJT has waived its sovereign immunity by raising it
too late. Instead, the majority says that we lack jurisdiction to determine whether we lack
-2-
-3- No. 11
jurisdiction over these parties. Therefore, we have jurisdiction to dismiss this case for lack
of jurisdiction, thereby leaving in place the Appellate Division’s decision, namely, that
New York courts had jurisdiction over the case all along, and Ms. Henry can collect
Supreme Court’s $979,579.50 award in her favor (less the amounts covered by her own
health insurance).
I propose a simpler resolution, which is the same as the Appellate Division arrived
at: we have jurisdiction because New Jersey and NJT waived any right NJT had to claim
sovereign immunity. NJT asserted its sovereign immunity defense more than five years
after Ms. Henry sued and more than one year after the United States Supreme Court issued
the opinion on which it now relies. By asserting sovereign immunity now, NJT would
leave Ms. Henry without any forum in which to bring her suit. That type of strategic
maneuvering belies the claim that NJT has been haled into a foreign court without its
consent.
But even if NJT did not consent to our jurisdiction via its litigation conduct, it more
fundamentally consented by operating in New York with the knowledge that persons in
New York would inevitably be harmed by its actions. Like so many of the New Jerseyans
and New Yorkers it carries, NJT has a foot in both New York and New Jersey. It operates
a billion-dollar transportation business that, like a range of public and private carriers,
ferries vast numbers of passengers into and out of New York each day. Those other carriers
can be sued in New York courts for violating New York law. Our courts are vital not only
for keeping New Yorkers—and New Jerseyans like Ms. Henry, for that matter—safe from
NJT’s operations within our borders, but for creating the conditions that make operating in
-3-
-4- No. 11
New York so lucrative for NJT in the first place. Indeed, New Jersey itself recognizes the
importance of subjecting NJT to judicial process and has already done so for claims arising
in New Jersey. NJT provides no compelling reason why Newark Penn Station should be
governed by a different set of sovereign immunity rules than New York Penn Station. New
Jersey’s respect for New York’s equality and sovereignty requires it to consent to the same
control it exercises over its own territory.
Thankfully, the majority’s decision yields the correct outcome, albeit for the wrong
reason: instead of affirming the Appellate Division’s holding that NJT waived whatever
sovereign immunity it might have claimed, the majority dismisses this appeal, leaving the
Appellate Division’s waiver holding in place.1 The jury’s verdict in favor of Ms. Henry
will stand and NJT will not be subjected to the power of an illegitimate tribunal. But the
majority’s decision will not resolve problems going forward. There have been many of
these cases already and more are rolling down the pike (e.g. Colt v New Jersey Tr. Corp.,
206 AD3d 126, 127 [1st Dept 2022] [“The constitutional dilemma concerning the doctrine
of sovereign immunity continues unabated”]; Taylor v New Jersey Tr. Corp., 199 AD3d
540 [1st Dept 2021]; Belfand v Petosa, 196 AD3d 60 [1st Dept 2021]; Fetahu v New Jersey
Tr. Corp., 197 AD3d 1065 [1st Dept 2021]). Lower courts will need our guidance with a
relatively new and complicated doctrine. By misapplying our preservation jurisprudence
1
Neither the majority nor my dissent addresses whether NJT is entitled to sovereign
immunity at all (cf. Hess v Port Auth. Trans-Hudson Corp., 513 US 30 [1994]). The
majority concludes that the issue is not preserved and I conclude that any immunity would
have been waived, rendering it unnecessary to consider that question.
-4-
-5- No. 11
and failing to address this recurring issue, the majority leaves NJT, future litigants,
regulators, and lower courts in the dark.
I.
The majority says that we need not determine whether NJT has asserted a valid
jurisdictional objection because the defense was unpreserved, meaning that this case does
not “directly involve[] the construction of the constitution of the state or of the United
States” (NY Const, art VI, § 3 [b] [1]; see majority op at 4 [emphasis omitted]). Here is
the problem: NJT says the New York courts lacked the power to hear the case because of
New Jersey’s sovereign immunity. If that is true, we are employing our preservation
doctrine to permit the New York courts to assert jurisdiction where they have none. If that
is false, whether because of waiver or some other reason, we should just say so. Instead,
the majority assumes that—regardless of whether NJT has a valid and unwaived sovereign
immunity claim—we may apply our docket-management tool to nullify a limit on our
jurisdiction imposed by the Federal Constitution. It further transforms our preservation
doctrine, which was designed to help us “cope” with our historically “voluminous”
caseload (cf. Karger, § 2:1) into a tool for expanding our reach by allowing us to assert
jurisdiction over cases we otherwise might not be able to hear. Because our preservation
doctrine cannot confer jurisdiction over cases and parties when the Federal Constitution so
forbids, I cannot join the majority.
Our preservation doctrine, on which the majority opinion rests, cannot allow us to
avoid our constitutional obligation to resolve this dispute. In prior cases, we have
-5-
-6- No. 11
dismissed appeals for lack of a preserved substantial constitutional question (see majority
op at 14, citing Matter of Schulz v State of New York, 81 NY2d 336, 344 [1993]). Those
cases have not involved challenges to our jurisdiction, nor arguments that a jurisdictional
challenge has been waived. In New York, jurisdictional challenges are typically either
immune from our preservation requirement (see majority op at 10) or, as with personal
jurisdiction, subject to a waiver doctrine so strict that no unpreserved jurisdictional
argument could possibly exist (see CPLR 3211 [e]; Addesso v Shemtob, 70 NY2d 689, 690
[1987] [internal quotation marks omitted] [noting that a party waives personal jurisdiction
by failing to timely assert it]).
NJT’s challenge falls squarely into our well-established exception to the
preservation requirement for jurisdictional challenges to our authority (see e.g. Matter of
Kaplan (Blumenfeld), 8 NY2d 214, 220 [1960] [“this lack of a subpoena was not raised by
appellant in the courts below but, being jurisdictional and conclusive, it may be acted on
by us”]; see generally Arthur Karger, Powers of the New York Court of Appeals § 17:5
[3d ed rev, Aug. 2022 update]). The majority’s claim that we have a “subject-matter-
jurisdiction exception” only (majority op at 12 [emphasis added]) ignores the underlying
logic of our exception and rests on a false congruence of jurisdiction and waivability.
Moreover, Ms. Henry’s waiver argument also falls into a second preservation
exception because NJT could not have made any factual or legal countersteps between the
time when it asserted its sovereign immunity defense and the point at which it advanced
the argument here (see generally Telaro v Telaro, 25 NY2d 433, 439 [1969]).
-6-
-7- No. 11
A.
As the majority notes, “ ‘all jurisdiction implies superiority of power,’ [and] no
authority c[an] hear a case ‘unless that court ha[s] a power to command the execution of
it’ ” (majority op at 6, quoting 1 William Blackstone, Commentaries on the Laws of
England at 235 [1765]). If the constitution denies a court jurisdiction over a class of cases
or a party, the court lacks “constitutional power to adjudicate the case” (Reed Elsevier, Inc.
v Muchnick, 559 US 154, 160-161 [2010], quoting Steel Co. v Citizens for Better
Environment, 523 US 83, 89 [1998]). The Hyatt III Court stated that the Federal
Constitution denies state courts jurisdiction over nonconsenting states: a “[s]tate’s assertion
of compulsory judicial process over another [s]tate involves a direct conflict between
sovereigns. The Constitution implicitly strips [s]tates of any power they once had to refuse
each other sovereign immunity, just as it denies them the power to resolve border disputes
by political means” (Hyatt III, 139 S Ct at 1498; see also id. at 1495).
The fact that sovereign immunity can be waived does not make it any less
jurisdictional when it has not been waived. In the Eleventh Amendment context, the fact
that the immunity may be waived by litigation conduct does not “vitiate[] any legal
justification” (majority op at 12) for requiring a sovereign to preserve its immunity defense
(see Calderon v Ashmus, 523 US 740, 745 n 2 [1998] [“the Eleventh Amendment is
jurisdictional in the sense that it is a limitation on the federal court’s judicial power, and
therefore can be raised at any stage of the proceedings”]; Pennhurst State School & Hosp.
v Halderman, 465 US 89, 99 [1984] [“The limitation deprives federal courts of any
-7-
-8- No. 11
jurisdiction to entertain such claims, and thus may be raised at any point in a proceeding”
despite being waivable]; Wisconsin Dept. of Corrections v Schacht, 524 US 381, 395
[1998] [Kennedy, J., concurring] [Eleventh Amendment sovereign immunity represents a
“departure from the usual rules of waiver”]). Claim-processing rules like our preservation
requirement cannot confer power on a tribunal where the Federal Constitution denies it.
Federal personal jurisdiction jurisprudence further demonstrates that waivability
does not make a jurisdictional limit any less binding on a court. The personal jurisdiction
requirement “represents a restriction on judicial power” the same as subject-matter
jurisdiction requirement (Insurance Corp. of Ireland v Compagnie des Bauxites de Guinee,
456 US 694, 702 [1982]). Because “there is no unyielding jurisdictional hierarchy,” federal
courts without subject-matter jurisdiction over a case may hear the case anyway to the
extent necessary to resolve questions of personal jurisdiction (Ruhrgas AG v Marathon Oil
Co., 526 US 574, 578 [1999]). The fact that a party may waive a personal jurisdiction
challenge does not make it any less “fundamental” (id. at 584). Although “a jurisdictional
defect [with respect to subject-matter jurisdiction] may not be waived” (Karger, § 17:5), a
defect with respect to personal jurisdiction may be waived (see Insurance Corp. of Ireland,
456 US 694, 703-704 [1982]). That difference, however, does not render the lack of
personal jurisdiction nonjurisdictional.
Our jurisdictional exception to the preservation requirement is premised on the
fundamental principle that we cannot hear a case over which we lack power and applies to
all jurisdictional challenges to our authority (see Editorial Photocolor Archives v Granger
-8-
-9- No. 11
Collection, 61 NY2d 517, 523 [1984] [“A judgment or order issued without subject matter
jurisdiction is void, and that defect may be raised at any time and may not be waived”]).
A true jurisdictional defect in a judgment is “so fundamental to the power of adjudication
of a court that [it] survive[s] even a final judgment or order” (Lacks v Lacks, 41 NY2d 71,
74-75 [1976]). Because a jurisdictional defect would “undermine the constitutional or
statutory basis to hear a case” and invalidate the judgment, we do not apply our preservation
requirement to jurisdictional defects (see Matter of Ballard, 6 NY3d at 663; Ocean
Accident & Guarantee Corp., Ltd. v Otis Elevator Co., 291 NY 254, 255 [1943] [“This
court possesses only those powers which are conferred by the Constitution . . . . (s)uch
powers . . . may not be enlarged by consent of the parties”]; People v Nicometi, 12 NY2d
428, 431 [1963] [“Want of jurisdiction is a basic defect, not a trial error . . . [s]ince this
defect would undoubtedly be grounds for the issuance of a writ of habeas corpus, it most
assuredly can be remedied on appeal”]). As with subject-matter jurisdiction, “[t]he
question of [sovereign immunity] is a question of judicial power: whether the court has
the power, conferred by the Constitution or statute, to entertain the case before it” (see
majority op at 10, quoting Matter of Ballard v HSBC Bank USA, 6 NY3d 658, 663 [2006]).
As a matter of Federal Constitutional law, a judgment rendered by a court without
jurisdiction over a party is invalid and not entitled to the respect of other courts (see V.L.,
577 US at 407; Bristol-Myers Squibb Co. v Superior Court of California, San Francisco
County, 137 S Ct 1773, 1776 [2017]).
-9-
- 10 - No. 11
The fact that subject-matter jurisdiction cannot be waived and may be raised by a
court sua sponte (see majority op at 10-12) is a consequence of the way in which subject-
matter jurisdiction limits our power: that is, it is the kind of limit on our authority that
cannot be cured by the consent of the parties. When we articulated the jurisdictional
exception to preservation in Editorial Photocolor Archives, we did not say that a judgment
issued without subject-matter jurisdiction could be raised at any time because it was
waivable—rather, we said that it could be raised at any time “and may not be waived” (61
NY2d at 523 [emphasis added]). But other jurisdictional limits—like personal
jurisdiction—can be overcome by the consent of the parties. Subject-matter jurisdiction’s
lack of waivability is not the reason we do not apply our preservation requirement to issues
of subject-matter jurisdiction. Rather, we do not apply preservation in that context because
our preservation doctrine is a prudential tool that can serve the interests of judicial economy
and finality but cannot enhance our jurisdiction.
The majority defends its decision with nested legal fictions. The first is that
unpreserved questions of law are somehow no longer questions of law (see majority op at
4 n 2). The New York Constitution vests our court with jurisdiction “limited to the review
of questions of law” (art VI, § 3 [a]). Our case law does not explain how a litigant’s failure
to raise a purely legal question at the right time transmutes it from a question of law to not
a question of law. In moments of candor, we have admitted that our claim that unpreserved
questions of law are not questions of law is rooted in prudential considerations, sometimes
used to deny ourselves jurisdiction. Even in the criminal context, where the preservation-
- 10 -
- 11 - No. 11
as-jurisdictional argument is on stronger—though not decisive—legal footing (see CPL
470.05 [2]), we have acknowledged that “[t]he requirement that a claim must be timely
raised in order to create a question of law is grounded in large part in the need to preserve
limited judicial resources and avoid untoward delay in the resolution of criminal
proceedings,” even as we have asserted that preservation is jurisdictional (People v
Michael, 48 NY2d 1, 6 [1979]). But that legal fiction proves too much. If preservation
were truly jurisdictional, we would not be able to create exceptions “when common sense
and practical necessity dictate that we should” (Misicki v Caradonna, 12 NY3d 511, 525-
526 [2009] [Smith, J., dissenting]). Instead, when applying our requirement seems harsh,
we have dispensed with it altogether, as when “certain principles of law are deemed so
fundamental to our criminal justice system that a claimed violation of those principles
creates a question of law despite the failure to timely raise that claim in the courts below”
(Michael, 48 NY2d at 6).
The majority does not, as in those other cases, simply ignore the fiction that
unpreserved questions of law are not questions of law. Instead, it turns to a nineteenth-
century case in which we said: “[j]urisdiction of the subject-matter, is power to adjudge
concerning the general question involved, and is not dependent upon the state of facts
which may appear in a particular case, arising, or which is claimed to have arisen, under
that general question” (Hunt v Hunt, 72 NY 217, 229 [1878]; see majority op at 10).
Whereas the “unpreserved-questions-of-law-are-not-questions-of-law” fiction renders
legal questions unreachable, the “subject-matter-jurisdiction-does-not-involve-facts”
- 11 -
- 12 - No. 11
fiction operates in reverse. Taken as a serious proposition, however, that second fiction
fares no better than the first: the framing of a general question of subject-matter jurisdiction
often depends on facts. Examples of such questions reviewable by us under the
jurisdictional exception abound: “[w]hether the essential nature of the claim is to recover
money, or whether the monetary relief is incidental to the primary claim,” an inquiry that
“is dependent upon the facts and issues presented in a particular case” (see Matter of Gross
v Perales, 72 NY2d 231, 236 [1988]); whether the accusatory instrument was valid (see
People v Harper, 37 NY2d 96, 99 [1975]); whether the defendant was served with a
subpoena (see Matter of Kaplan, 8 NY2d at 220); whether the appealing party filed its
notice of appeal within the right number of days (see Cappiello v Cappiello, 66 NY2d 107,
108 [1985]); whether the administrative agency’s decision was based on a law it could
enforce (see Montella v Bratton, 93 NY2d 424, 432 [1999]); whether the trial court’s order
was appealable (see People v McDonald, 68 NY2d 1, 14 [1986]); and whether the record
in the case was “a mechanical recording” or instead was “taken by a court stenographer”
(see People v Smith, 27 NY3d 643, 649 [2016]). Questions of subject-matter jurisdiction,
then, often turn on the facts of a particular case.
Thankfully, our precedent explains that “jurisdictional” often has not truly meant
“jurisdictional,” a proposition that cabins the precedential impact of the majority’s opinion.
In Lacks v Lacks, we dismissed “a line of decisions dating back to the last century and
continuing into the present” on the ground that we spoke with “less than perfect
meticulousness” when we used the phrase “jurisdiction” (41 NY2d at 74). We explained
- 12 -
- 13 - No. 11
that “[a] statement that a court lacks ‘jurisdiction’ to decide a case may, in reality, mean
that elements of a cause of action are absent,” and that “questions of mootness and standing
of parties may be characterized as raising questions of subject matter jurisdiction,” but are
nonetheless not the “kinds of judicial infirmities” that would constitute a “lack of true
subject matter jurisdiction or competence” (id. at 74-75; see also Reed Elsevier, Inc., 559
US at 161 [“such ‘drive-by jurisdictional rulings. . .’ too easily can miss the ‘critical
difference(s)’ between true jurisdictional conditions and nonjurisdictional limitations on
causes of action” (alteration in original)]). If preservation deprived our court of jurisdiction
in the same way lack of personal jurisdiction or subject-matter jurisdiction did, a ruling on
the basis of an unpreserved argument would constitute grounds for a motion to vacate the
judgment (see Lacks, 41 NY2d at 76; Royal Zenith Corp. v Continental Ins. Co., 63 NY2d
975, 977 [1984] [“A court is without power to render a judgment against a party as to whom
there is no jurisdiction . . . and a judgment rendered without jurisdiction is subject to
collateral attack”]). Unless the majority has announced a sweeping new procedural
mechanism for collaterally attacking our own judgments, it follows our tradition of
speaking with “less than perfect meticulousness” (see Lacks, 41 NY2d at 74). Indeed, the
very phrase “subject-matter-jurisdiction exception” (majority op at 12) would be
incoherent if we truly lacked subject-matter jurisdiction over unpreserved claims.
B.
Ms. Henry’s waiver arguments fall into a second exception to our preservation
requirement as well. Contentions which could not “have been obviated or cured by factual
- 13 -
- 14 - No. 11
showings or legal countersteps . . . . below may be raised on appeal for the first time”
(Telaro v Telaro, 25 NY2d 433, 439 [1969]; accord Bingham v New York City Transit
Authority, 99 NY2d 355, 359 [2003]). NJT could not, when it first asserted its defense in
2020, have made any countermoves that would change the status of its waiver. It could
not have traveled back to May 2019 and alerted Supreme Court that Hyatt III had changed
the doctrinal landscape. Nor could it have gone further back and either not decided to do
business in New York or repealed New Jersey’s waiver of sovereign immunity. Indeed, if
anyone was denied countermoves, it was Ms. Henry, who was denied the ability to access
relevant discovery concerning what, if any, concessions NJT made in order to be able to
operate in New York.2
In this case, the majority’s preservation ruling did not prejudice Ms. Henry because
the Appellate Division correctly ruled that NJT had waived any sovereign immunity it
might have been able to claim. Had it gone the other way, however, the majority’s
application of the preservation doctrine would have served to blindside Ms. Henry and
deny her the ability to litigate this issue fully. Such a decision would defy common sense
and the fair expectations of litigants.
2
Ms. Henry observes that, because NJT first raised sovereign immunity on appeal, she had
no opportunity to discover whether any agreements between New York and New Jersey
already exist by which New Jersey has contractually waived its sovereign immunity in
connection with the operation of NJT in New York.
- 14 -
- 15 - No. 11
II.
The scope of immunity asserted by NJT exceeds the scope of historical practice. In
an effort to make an anachronistic “meaning move across time,” lawyers sometimes ignore
the important context and nuance that has characterized the historical practice of suits
against sovereigns (cf. Lauren Benton, Beyond Anachronism: Histories of International
Law and Global Legal Politics, 21 J of the Hist of Int’l L 7, 10 [2019] [internal quotation
marks omitted]). The historical practice of private litigation against sovereign entities
suggests that the rhetoric often used to justify an expansive reading of sovereign immunity
is misleading at best.
The U.S. Supreme Court has identified two historical strands that are braided
together to form our contemporary doctrine of sovereign immunity: “common law
sovereign immunity” and “law-of-nations sovereign immunity” (Hyatt III, 139 S Ct at
1493). Both doctrines, as practiced at the time that the Federal Constitution was ratified,
permitted sovereign tribunals to vindicate the rights of private parties who had been harmed
by a government. One important basis for jurisdiction has long been a sovereign’s implied
consent to being sued, especially when a sovereign commits wrongs in another sovereign’s
territory.
“Common law sovereign immunity” provided subjects with wide latitude to sue
their own government officials and even the king himself. When William Blackstone
wrote that “no suit or action can be brought against the king, even in civil matters, because
no court can have jurisdiction over him,” he qualified his statement by noting that the king
- 15 -
- 16 - No. 11
could nonetheless be subject to process by his consent or “grace” (1 Blackstone, at 235-
236). Blackstone’s statement did not, however, mean that the king and his officials were
generally insulated from liability. To the contrary, the immunity of the king did not extend
to his officers (see Louis L. Jaffe, Suits Against Governments and Officers: Sovereign
Immunity, 77 Harv L Rev 1, 3 [1963]; James E. Pfander, Sovereign Immunity and the Right
to Petition: Toward a First Amendment Right to Pursue Judicial Claims Against the
Government, 91 Nw U L Rev 899, 920-921 [1997]). Moreover, sovereign immunity did
not shield the king himself from the law either. By Blackstone’s time “the requirement of
consent to suit had gradually disappeared,” as either the requirement was replaced by a
“fictional consent” or else “the authority to pass upon the petition was shifted from the
Crown to the courts of justice” (Pfander, at 911-912 [1997]).
At the time of this nation’s founding, “law-of-nations sovereign immunity”
recognized significant limits on a sovereign’s ability to escape another sovereign’s
tribunals for actions taken in that sovereign’s territory. As the fêted Emer de Vattel, “the
founding era’s foremost expert on the law of nations” opined, “ ‘[i]t does not ... belong to
any foreign power to take cognisance of the administration of [another] sovereign, to set
himself up for a judge of his conduct, and to oblige him to alter it . . . .’ The sovereign is
‘exemp[t] ... from all [foreign] jurisdiction’ ” (Hyatt III, 139 S Ct at 1493-1494, citing 2
Emer de Vattel, The Law of Nations § 55, at 155 [J. Chitty ed. 1883] and 4 id. § 108, at
486; see also John Fabian Witt, Lincoln’s Code: The Laws of War in American History 16
[2012] [describing Vattel as “the most widely ready authority in Europe and its colonies
- 16 -
- 17 - No. 11
on . . . the law of nations”]). Though it might sound sweeping, Vattel’s immunity mostly
referred to efforts by one nation to take charge of the internal governance of another: when
he explained that a foreign power could not take cognizance of the administration of
another sovereign, his quintessential examples involved a foreign sovereign who
supplanted a domestic sovereign for taxing his subjects too highly, inflicting unjust
punishments on his subjects, or contravening Christian morals—“things, for which [the
domestic sovereign] was not at all accountable to [the foreign sovereign]” (2 id. § 55, at
155-156; accord 1 James Kent, Commentaries on American Law 20-21 [Comstock ed.
1867]). By contrast, Vattel acknowledged a domestic sovereign’s “right to preserve herself
from all injury” because “when we cannot use constraint in order to cause our rights to be
respected, their effects are very uncertain” (2 Vattel § 49, at 154; accord 1 Kent at 22
[“Every nation has an undoubted right to provide for its own safety, and to take due
precaution against distant as well as impending danger”]).
Vattel further distinguished between types of conduct in his account of the immunity
afforded to the literal body of a foreign sovereign itself. Thus, if a prince were in a foreign
country to negotiate or “treat about some public affair” he would be “entitled in a more
eminent degree to enjoy all the rights of ambassadors,” whereas “[i]f he c[a]me as a
traveler, his dignity alone, and the regard due [his] nation” would “exempt[] him from all
jurisdiction,” though the host country could withdraw that protection if it so informed him
(4 Vattel § 108, at 486). However, if he “act[ed] as an enemy,” the prince would be entitled
to no regard at all (4 id. § 108, at 486). Moreover, the foreign prince could not exercise his
- 17 -
- 18 - No. 11
rights in such a manner as to “affect the sovereignty of the country in which he [was] a
sojourner” (id. at 487; see also 2 id. § 92, at 169 [“the least encroachment on the territory
of another is an act of injustice”]).
Vattel’s conception of sovereign immunity left sovereigns with wide latitude to
punish foreigners who committed transgressions within territorial boundaries and foreign
sovereigns who failed to force their subjects to repair the harms inflicted. “Even in cases
of ordinary transgressions, which are only subjects of civil prosecution . . . with a view to
the recovery of damages . . . the subjects of two neighboring states [we]re reciprocally
obliged to appear before the magistrate of the place where they [we]re accused of having
failed in their duty” (2 id. § 76, at 162). The foreign subject’s sovereign was generally not
permitted “to examine whether the accusation be true or false” and if the sovereign
“refuse[d] to cause reparation to be made for the damage done by his subject,” the
sovereign would “render[] himself in some measure an accomplice in the injury and
become[] responsible for it” (2 id. § 76-77, at 163).
In Early American courts, the customary recognition of “law-of-nations sovereign
immunity” was subject to a sovereign’s capacity and duty to govern its own territory. Early
American courts confronting the question of sovereign immunity held that any immunity
was subject to the consent of the host nation, as “[t]he jurisdiction of the nation within its
own territory is necessarily exclusive and absolute. It is susceptible of no limitation not
imposed by itself” (The Schooner Exchange v McFaddon, 7 Cranch [11 US] 116, 136
[1812] [Marshall, Ch. J.]; accord The Santissima Trinidad, 7 Wheat [20 US] 283, 353
- 18 -
- 19 - No. 11
[1822] [Story, J.] [“(C)onsent and license is implied only from the general usage of nations,
it may be withdrawn upon notice at any time, without just offence, and if afterwards such
public ships come into our ports, they are amenable to our laws in the same manner as other
vessels”]). In addition to recognizing a nation’s general capacity to withdraw its consent,
Chief Justice Marshall also noted that sovereign immunity was never assumed to extend to
certain types of cases. In a leading case on the subject, Chief Justice Marshall recognized
“cases of implied assent” to foreign jurisdiction, including cases in which the sovereign
“acquire[d] property in the country, whether real or personal” or “[i]n case of offences
against existing laws, such as . . . breaking the peace when in port,” though this implication
did not extend “where the sovereignty is concerned,” as in cases of “an ambassador” or the
“sovereign himself” (The Schooner Exchange 7 Cranch [11 US] at 125).
Of course, the historical practice of what we in retrospect call “sovereign immunity”
between nation states does not fully account for the unique structure of the Federal
Constitution, though it illustrates the background expectations the framers would have had
when they designed the constitutional order (see Hyatt III, 139 S Ct at 1497 [“the
Constitution affirmatively altered the relationships between the States, so that they no
longer relate to each other solely as foreign sovereigns”]). In Federalist No. 81, Alexander
Hamilton commented on the fact that a sovereign could not be sued in a court without its
consent (see majority op at 7, quoting Federalist No. 81) and in the Debates of the Virginia
Convention, James Madison asserted that “[i]t is not in the power of individuals to call any
state into court” (Virginia Debate, June 20, 1788, reprinted in 3 The Debates in the Several
- 19 -
- 20 - No. 11
State Conventions of the Adoption of the Federal Constitution 531, 533 [J. Elliot ed.,
1866]). There is no indication, however, that either Hamilton or Madison meant to sweep
aside well-established doctrines of implied consent. Hamilton’s statement responded to
concerns that citizens of foreign states would attempt to enforce a state’s debt contracts in
federal court (see Hamilton, Federalist No. 81), an option that would not have been
available to international creditors under the law of nations, for whom debts with a
sovereign were tantamount to treaties, which bound only the conscience of the nation and
would not have been enforceable in a court (see Vattel, Preliminaries, § 21, at lxiii-lxiv; 2
Vattel, § 214, at 226-227; Jennifer Pitts, Boundaries of the International: Law and Empire
70 [2018]; see also John J. Gibbons, The Eleventh Amendment and State Sovereign
Immunity: A Reinterpretation, 83 Colum L Rev 1889, 1910-1912 [noting that Hamilton’s
remark did not suggest a sweeping sovereign immunity]). 3 Madison similarly made sure
to qualify that “if a state should condescend to be a party, this court may take cognizance
of it” (Madison, at 533; see also Gibbons at 1906 [noting that Madison’s statement “[i]n
context . . . becomes more ambiguous”]). Indeed, an expansive reading of either remark
would make little sense with article III, section 2, clause 1 of the Federal Constitution,
3
Chisholm v Georgia (2 Dall [2 US] 419 [1793]) involved exactly the type of case that
Hamilton warned against, and which would not have been cognizable under prevailing
understandings of sovereign immunity—a foreign-state creditor’s attempt to use federal
court to enforce a debt contract against the state of Georgia. Americans promptly rebuked
the Federal Supreme Court with the Eleventh Amendment, an amendment designed to limit
the jurisdiction of federal courts in cases like these (see generally Stephen E. Sachs &
William Baude, The Misunderstood Eleventh Amendment, 169 U Pa L Rev 609, 626
[2021]). However, the Eleventh Amendment—which explicitly only reaches diversity
cases in federal courts—did not sweep so broadly as to preclude all suits.
- 20 -
- 21 - No. 11
which clearly envisions some justiciable “Controversies . . . between a State and Citizens
of another state.”
Early American practice confirms the limits on sovereign immunity when
government officials from foreign states or countries inflicted harm within a state’s
territory. Americans generally expected to be able to use common law suits to hold
government officials directly accountable for their misconduct; the government officials
could then petition their respective legislatures for private bills indemnifying them for the
judgment, thus obviating the need to sue states directly (see generally Jerry L. Mashaw,
Reasoned Administration and Democratic Legitimacy 17 [2018]; James E. Pfander and
Jonathan L. Hunt, Public Wrongs and Private Bills: Indemnification and Government
Accountability in the Early Republic, 85 NYU L Rev 1862, 1871-1876 [2010]; A True
Federalist, Independent Chronicle, Mar 2 and 6, 1797, reprinted in Maeva Marcus ed., 5
The Documentary History of the Supreme Court, 1789-1800, at 629, 630 [1994]). That
expectation often extended to the agents and instrumentalities of foreign states, as
Americans could often sue in their home state court if those officers or instrumentalities
committed wrongs in the home state, owned property in the home state, engaged in
commercial activity, or consented to suit in some other way (see Ann Woolhandler,
Interstate Sovereign Immunity, 2006 S Ct Rev 249, 276-277 [2006]).
Subsequent efforts to expand the scope of American sovereign immunity have
largely left open the broad scope of the historical consent doctrine. In Hans v Louisiana,
the Supreme Court explained that the Constitution should not be understood to permit
- 21 -
- 22 - No. 11
“anomalous and unheard-of proceedings or suits” in federal court, and that “state courts
have no power to entertain suits by individuals against a state without its consent” (134 US
1, 18 [1890] [emphasis added]). The spate of twentieth-century cases addressing sovereign
immunity typically concerned the Eleventh Amendment and federal jurisdiction, not
interstate sovereign immunity. As the United States Supreme Court noted in Nevada v
Hall, its prior case law did not “answer the question whether the Constitution places any
limit on the exercise of one’s State’s power to authorize its courts to assert jurisdiction over
another State” (440 US 410, 421 [1979]). The Hall court answered that the Federal
Constitution created no such limit, and that states extended immunities to one another as a
matter “of state policy, rather than a constitutional command” (id. at 425). It was not until
Hyatt III that the Supreme Court articulated a constitutional basis for a foreign state’s
ability to assert sovereign immunity in another state’s court.
Even under this new regime, however, the U.S. Supreme Court has been careful to
qualify that “the Constitution bars suits [only] against nonconsenting States” (Hyatt III,
139 S Ct at 1496 [emphasis added]). In the analogous Eleventh Amendment context, the
Supreme Court has found that the “[t]he States have consented . . . to some suits pursuant
to the plan of the Convention or to subsequent constitutional Amendments” (Alden v
Maine, 527 US 706, 755 [1999]). At this point, the list of implied consent includes
bankruptcy proceedings (Central Va. Community College v Katz, 546 US 356, 379 [2006]);
eminent domain proceedings (PennEast Pipeline Co., LLC v New Jersey, 141 S Ct 2244,
2263 [2021]); the federal policy to build and keep a national military (Torres v Texas
- 22 -
- 23 - No. 11
Department of Public Safety, 142 S Ct 2455, 2460 [2022]); the enforcement power of the
Fourteenth Amendment (see Fitzpatrick v Bitzer, 427 US 445, 456 [1976] [justifying the
Fourteenth Amendment as an exception to sovereign immunity]); suits by other States
(South Dakota v North Carolina, 192 US 286, 318 [1904]); and suits by the Federal
Government (United States v Texas, 143 US 621, 646 [1892]).
III.
Admittedly, the Hyatt III regime is still somewhat terra incognita. However, the
new sovereign immunity can still be waived. The touchstone principle is that “[e]ach
State’s equal dignity and sovereignty under the Constitution implies . . . . the inability of
one State to hale another into its courts without the latter’s consent” (Hyatt III, 139 S Ct at
1497; see also PennEast Pipeline Co., LLC v New Jersey, 141 S Ct 2244, 2264 [2021]
[Gorsuch, J., concurring]). If NJT submits to the jurisdiction of New York courts, then, it
loses the ability to claim that its sovereignty has been violated—assuming, arguendo, that
NJT (as opposed to the State of New Jersey itself) has any right to assert sovereign
immunity in the first place.
Because NJT’s sovereign immunity claim falls into our jurisdictional exception, I
must address the merits of its argument. To the extent that NJT might be entitled to a
sovereign immunity defense, it and the state of New Jersey consented to New York
jurisdiction in three ways. Because those three ways are independent and none has a logical
or legal priority over the others, I discuss each below. First, NJT waived sovereign
immunity by its litigation conduct: NJT did not assert a sovereign immunity defense at the
- 23 -
- 24 - No. 11
first opportunity after Hyatt III, waiting instead until it perfected its appeal to make this
argument. Second, NJT waived any claim of sovereign immunity it might have had by
operating a multimillion-dollar business within the State of New York. Third, the state of
New Jersey waived any sort of sovereign immunity defense on NJT’s behalf by subjecting
it to liability in New Jersey.
A.
Hyatt III suggests that a state can waive its sovereign immunity by its litigation
conduct (see 139 S Ct at 1491 n 1). The U.S. Supreme Court is clear that waiver by
litigation conduct can express a state’s consent to jurisdiction (cf. Atascadero State Hosp.
v Scanlon, 473 US 234, 238 [1985] [“if a State waives its immunity and consents to suit in
federal court, the Eleventh Amendment does not bar the action”]). Because interstate
immunity is rooted in the indignity of “compulsory judicial process” (id. at 1498), a
“State’s voluntary appearance in [another State’s] court amounts to a waiver of its
[sovereign] immunity,” as it does in the Eleventh Amendment context (cf. Lapides v Board
of Regents of Univ. System of Ga., 535 US 613, 619 [2002] [describing the Eleventh
Amendment context]; Petty v Tennessee-Missouri Bridge Comm’n, 359 US 275, 276
[1959] [same]; Gunter v Atlantic Coast Line R. Co., 200 US 273, 284 [1906]; Clark v
Barnard, 108 US 436, 447 [1883] [same]).
Whatever the exact contours of the litigation-conduct waiver doctrine in the
Eleventh Amendment context, a state may not assert the interstate sovereign immunity
defense after it has allowed a case to proceed to judgment in another state’s tribunal, as
- 24 -
- 25 - No. 11
NJT has here. Permitting states to assert sovereign immunity after another court has tried
and decided a case would let states abuse the Full Faith and Credit Clause, subverting the
logic of federalism and needlessly stripping jurisdiction from the litigating state’s court.
The “animating purpose of the full faith and credit command” is to make the states “
‘integral parts of a single nation throughout which a remedy upon a just obligation might
be demanded as of right, irrespective of the state of its origin,’ ” instead of “ ‘independent
foreign sovereignties, each free to ignore obligations created under . . . the judicial
proceedings of the others’ ” (Baker by Thomas v General Motor Corp, 522 US 222, 232
[1998], quoting Milwaukee County v M.E. White Co., 296 US 268, 277 [1935]). To that
end, the Full Faith and Credit Clause ensures that a State “may not disregard the judgment
of a sister State because it disagrees with the reasoning underlying the judgment or deems
it to be wrong on the merits” (V.L. v E.L., 577 US 404, 407 [2016]).
Allowing a state that has voluntarily litigated a case to the merits to subsequently
assert sovereign immunity would let a state use the Full Faith and Credit clause to seek
multiple trials and pit the tribunals of one state against another. A state may not obtain a
judgment in a foreign tribunal and then—if dissatisfied with the result—claim that it was
never bound by the foreign tribunal’s decision in the first place. Although this type of
judgment shopping is possibly unavoidable in federal court because of the jurisdiction-
stripping wording of the Eleventh Amendment (see Schacht, 524 US at 394 [Kennedy, J.,
concurring]), it defies the structural logic of interstate sovereign immunity: permitting that
type of judgment shopping would encourage States to avoid their own courts by litigating
- 25 -
- 26 - No. 11
first in foreign tribunals with the preclusive effect of the Full Faith and Credit Clause and
then—if unsuccessful—to assert sovereign immunity as a “get-out-of-judgment-free” card.
Indeed, in this case, if NJT were victorious in asserting its sovereign immunity defense,
Ms. Henry would be barred by New Jersey’s statute of limitations from bringing her suit
in New Jersey (see NJ Stat Ann § 59:8-8). When NJT decided to litigate this case in New
York for five years, it surrendered the right to claim that the forum was inappropriate.
NJT argues that its decision to litigate this case through to a jury verdict is irrelevant
because Hyatt III had not been decided until after Supreme Court issued its initial
judgment. However, NJT did not assert its sovereign immunity defense in a timely manner.
Hyatt III was decided on May 13, 2019. At the time, this matter was still pending in the
trial court, which denied NJT’s motion to set aside the jury verdict on June 27, 2019. NJT
made no effort to apprise the trial court of Hyatt III or assert a new defense based on it.
NJT did not include any mention of Hyatt III or sovereign immunity in its notice of appeal
on September 4, 2019. Not until it perfected its appeal on October 5, 2020 did NJT argue
for the first time that sovereign immunity precluded Supreme Court from rendering a
verdict. Its dilatory conduct constitutes a waiver.
B.
The logic of Hyatt III supports Ms. Henry’s claim that NJT waived any sovereign
immunity it might have had by choosing to conduct an ongoing business in the State of
New York. Recognizing NJT’s consent to being sued in New York reflects the asymmetric
nature of the sovereign interests in this case: New Jersey suffers little indignity when its
- 26 -
- 27 - No. 11
commercial transit business creates injuries within New York’s borders and is brought
before New York courts to answer for those injuries. New Jersey’s consent to jurisdiction
reflects its respect for New York’s important sovereign interests in governing the safety of
its territory and protecting persons within its borders.
New Jersey is “no longer [a] fully independent nation[]” and lacks the political
power to avoid the legal resolution of New Yorkers’ grievances against it (see Hyatt III,
139 S Ct at 1497; cf. Torres v Texas Department of Public Safety, 142 S Ct 2455, 2462
[2022] [“States may be sued if they agreed their sovereignty would yield as part of the plan
of the Convention . . . that is, if the structure of the original Constitution itself reflects a
waiver of States’ sovereign immunity” (internal quotations omitted)]). The Constitution
has stripped states of traditional remedies available to independent nation-states if foreign
sovereigns failed to redress injuries within their borders, including the ability to engage in
diplomacy, refuse sovereign immunity to the foreign sovereign, levy war (see Hyatt III,
139 S Ct at 1497-1498), or bar foreign sovereigns from entering their territory (cf. C & A
Carbone, Inc. v Town of Clarkstown, N.Y., 511 US 383, 390 [1994]; 2 Vattel § 94, at 169-
170 [“The sovereign may forbid the entrance of his territory either to foreigners in general
or in particular cases, or to certain persons or for certain particular purposes, according as
he may think it advantageous to the state . . . everyone is obliged to pay respect to the
prohibition”]). In part to compensate for this loss of sovereignty, the Constitution imposed
duties on states that they did not have before, and has turned some subjects that once were
“decided by pure ‘political power’ before ratification” into ones that “now turn on . . . ‘rules
- 27 -
- 28 - No. 11
of law’ ” (id. at 1498, quoting Rhode Island v Massachusetts, 12 Pet [37 US] 657, 737
[1838]). Indeed, a dispute that would be a “casus belli” between fully sovereign states is
the quintessential example of when the United States Supreme Court may exercise its
original jurisdiction, furnishing a tribunal worthy of such an important dispute (see State
of Nebraska v State of Wyoming, 515 US 1, 8 [1995], quoting Mississippi v Louisiana, 506
US 73, 77 [1992]). Whereas in the past a sovereign’s wrong might result in expulsion,
retaliation, or even war, today the wrong results in legal process. Under Hall, the forum
state’s tribunal would determine which state had jurisdiction; after Hyatt III, “federalism”
guides our analysis instead (Hyatt III, 139 S Ct at 1498, quoting Hall, 440 US at 430[Blackmun, J., dissenting]).
Federal jurisprudence surrounding personal jurisdiction—which involves issues
that “align closely with [the] treatment of” the concepts central to sovereign immunity (see
majority op at 12)—underscores the way jurisdiction in a federalist system is sensitive to
the parties’ underlying interests and the particular context of a given dispute. In personal
jurisdiction cases, principles of “ ‘interstate federalism’ support jurisdiction” when the
forum states have “significant interests at stake—‘providing [their] residents with a
convenient forum for redressing injuries inflicted by out-of-state actors,’ as well as
enforcing their own safety regulations” (Ford Motor Company v Montana Eighth Judicial
District Court, 141 S Ct 1017, 1030 [2021], quoting Burger King Corp. v Rudzewicz, 471
US 462, 473 [1985]). Indeed, “if another State were to assert jurisdiction in an
inappropriate case, it would upset the federal balance, which posits that each State has a
- 28 -
- 29 - No. 11
sovereignty that is not subject to unlawful intrusion by other States” (J. McIntyre
Machinery, Ltd. v Nicastro, 564 US 873, 884 [2011] [plurality op]). However, these
considerations must be weighed against “the Due Process Clause” right of the defendant,
which “act[s] as an instrument of interstate federalism” in addition to individual liberty and
can “divest the State of its power to render a valid judgment” (Bristol-Meyers Squibb Co.,
137 S Ct at 1776, citing World-Wide Volkswagen Corp. v Woodson, 444 US 286, 294
[1980]). The “primary focus” of the Due Process inquiry “is the defendant’s relationship
to the forum State” (Bristol-Meyers Squibb Co., 137 S Ct at 1779). If a defendant is
“essentially at home” in a State or “purposefully avails itself of the privilege of conducting
activities within the forum State . . . by, for example, exploiting a market in the forum
State” the federalism-enforcing Due Process Clause yields to the state interest in asserting
jurisdiction over activities within its own boundaries (Ford Motor Company, 141 S Ct at
1024 [internal quotation marks omitted]).
In other words, well-established principles of jurisdiction in a federalist context
establish that New York’s sovereign interests are relevant in determining when it has
jurisdiction and the nature of NJT’s contacts and presence in the state of New York helps
determine the extent to which it acquiesces to New York jurisdiction. In this case, New
York has a strong interest in protecting the integrity of its territory, the safety of its roads
and subjects, and its commercial prosperity whereas New Jersey has extensive, voluntary,
and lucrative contacts within the State of New York such that we may conclude that it has
- 29 -
- 30 - No. 11
consented to jurisdiction in New York. The principles of federalism that underpin both
personal jurisdiction and interstate sovereign immunity jurisprudence require nothing less.
A state’s ability to assert jurisdiction is heightened when it is governing its own
territory. Although the framers of the Federal Constitution envisioned an integrated nation,
they “also intended that the [s]tates retain many essential attributes of sovereignty,
including, in particular, the sovereign power to try causes in their courts” (World-Wide
Volkswagen, 444 US at 293; accord Bristol-Myers Squibb Co., 137 S Ct at 1780-1781).
State boundaries have long played an important role in determining the jurisdiction of these
courts (see World-Wide Volkswagen Corp., 444 US at 293 [“we have never accepted the
proposition that state lines are irrelevant for jurisdictional purposes, nor could we, and
remain faithful to the principles of interstate federalism embodied in the Constitution”]).
The jurisdictional importance of state boundaries is why “no State can apply its own law
to interstate disputes over borders” (Hyatt III, 139 S Ct at 1498, citing Cissna v Tennessee,
246 US 289, 295 [1918]; see also Texas Industries, Inc. v Radcliff Materials, Inc., 451 US
630, 641 [1981]). New York and New Jersey are no strangers to this principle (see New
Jersey v New York, 523 US 767 [1998]; State of New Jersey v People of State of New York,
5 Pet [30 US] 284 [1831]).
New York’s interest in protecting the safety of its roads is strong, and NJT’s
continued use of them is a basis from which we may infer consent. “Motor vehicles are
dangerous machines, and, even when skillfully and carefully operated, their use is attended
by serious dangers to persons and property” (Hess v Pawloski, 274 US 352, 356 [1927]; cf.
- 30 -
- 31 - No. 11
South Dakota v Neville, 459 US 553, 558-559 [1983]). To protect against these dangers,
states may provide rules of the road that apply to “residents and nonresidents alike” (Hess,
274 US at 356). States may assume that nonresidents who use the roads consent to a system
that will require them “to answer for [their] conduct in the state where arise causes of action
alleged against [them], as well as to provide for . . . claimant[s] a convenient method by
which [they] may sue to enforce [their] rights” (id.).
Furthermore, when a State operates a vast business within the boundaries of another
state—as NJT does—it weakens any claim it might have to special treatment (see Bank of
U.S. v Planters’ Bank of Georgia, 22 US 904, 907 [1824] [“It is, we think, a sound
principle, that when a government becomes a partner in any trading company, it devests
itself, so far as concerns the transactions of that company, of its sovereign character, and
takes that of a private citizen”]; Bank of Com. of Kentucky v Wister, 27 US 318, 323 [1829]
[extending this principle to a fully government-owned bank]; Louisville, C. & C.R. Co. v
Letson, 2 How [43 US] 497, 550-551 [1844] [extending Planters’ Bank to state ownership
share in railroad]; State of Ga. v City of Chattanooga, 264 US 472, 482-483 [1924] [“the
acceptance by Georgia of the permission given it to acquire the railroad land in Tennessee
is inconsistent with an assertion of its own sovereign privileges in respect of that land . . .
and amounts to a consent that it may be condemned as may like property of others”]; see
generally, Woolhandler, at 278-280 [discussing the “commercial/consent exception” to
sovereign immunity, and explaining that “(p)erhaps the largest group of cases holding a
state could be made a less-than-voluntary party were those arising from Georgia’s
- 31 -
- 32 - No. 11
ownership, with the approval of the Tennessee legislature, of a railroad in Tennessee”]).
As we noted in Ehrlich-Bober & Co. v University of Houston, New York has a “recognized
interest in maintaining and fostering its undisputed status as the preeminent commercial . .
. nerve center of the Nation and the world . . . . That interest naturally embraces a very
strong policy of assuring ready access to a forum for redress of injuries arising out of
transactions spawned here” (49 NY2d 574, 581 [1980]). The “interest in providing a
convenient forum is least subject to challenge when a transaction is centered here . . . and
particularly when it is wholly commercial in character . . . . [A] State entering this
jurisdiction specifically to take advantage of its unique commercial resources may be
considered to have given up any claim of jurisdictional immunity by virtue of governmental
capacity” (id.; see also Duetsche Bank Sec., Inc. v Montana Bd. of Invs., 7 NY3d 65, 72-
73 [2006]). Although Hyatt III may have changed the calculus and source of sovereign
immunity, it did not change New York’s sovereign interests.
In this case, then, New York’s sovereign interests are at their zenith while NJT’s are
at their nadir. Having operated a lucrative business for decades, NJT has availed itself of
New York’s roads, regulations, and customer base without exercising the type of sovereign
authority that commands heightened constitutional respect. NJT has benefitted from the
orderly operation of New York’s court system and largely complied with its rules of the
road. In Hyatt III, the Franchise Tax Board of California entered Nevada briefly to enforce
its own tax laws against one of its former citizens, in furtherance of which it committed
torts against that former citizen within Nevada (see 139 S Ct at 1490-1491). California’s
- 32 -
- 33 - No. 11
“sovereign right to tax income” was a particularly important interest and its run-in with
Nevada’s sovereignty was relatively minimal and incidental to its attempts to vindicate its
plenary right to tax its residents (cf. Oklahoma Tax Commn v Chickasaw Nation, 515 US
450, 466 [1995]). Here, by contrast, NJT has set up shop in New York, benefitted greatly
from the use of our roads, access to our economy and the protection provided by our court
system; it is being sued in New York for a tort committed in New York as to which New
York’s interests dwarf those of New Jersey. NJT may not now claim that submitting to
this same court system is an affront to its dignity.
C.
Notwithstanding the fact that NJT has waived any sovereign immunity it has via its
litigation conduct and continuous and extensive operations in New York, the State of New
Jersey has also statutorily waived any type of sovereign immunity NJT might have. States
may pass statutes explicitly consenting to be sued (cf. Sossaman v Texas, 563 US 277, 284
[2011] [discussing Eleventh Amendment sovereign immunity]). The operation of our own
Court of Claims depends upon that principle (see Court of Claims Act § 8). In the Eleventh
Amendment Context, a “State’s consent to suit in its own courts is not a waiver of its
immunity from suit in federal court” (Sossaman, 563 US at 285 [emphasis added]).
However, the “fundamental principle of equal sovereignty among the States” precludes
New Jersey from making a similarly limited waiver with respect to the courts of other states
(Hyatt III, 139 S Ct at 1497, quoting Shelby County v Holder, 570 US 529, 544 [2013]
[emphasis omitted]).
- 33 -
- 34 - No. 11
The United States Supreme Court has long held that a state may not refuse to apply
the laws of another state when doing so reflects a “policy of hostility to the public Acts” of
another state (Carroll v Lanza, 349 US 408, 413 [1955]). When New Jersey claimed that
it could not exercise jurisdiction over claims sounding in New York law despite exercising
jurisdiction over comparable claims based in New Jersey law, the United States Supreme
Court intervened (see Broderick v Rosner, 294 US 629, 642-644 [1935]; see also Hughes
v Fetter, 341 US 609, 611 [1951]). In Hyatt II, the Court applied that doctrine to
immunities, holding that Nevada had to grant California the same immunity it provided to
its own agencies—it could not apply “a special rule of law that evinces a ‘policy of
hostility’ toward California” (Franchise Tax Bd. of California v Hyatt, 578 US 171, 176
[2016] [hereinafter Hyatt II], quoting Franchise Tax Bd. of California v Hyatt, 538 US 488,
499 [2003]).
Here, New York and New Jersey have both waived sovereign immunity for quasi-
state commercial carriers, including NJT (see, e.g. NJ Stat Ann § 59:2-2; Public Authorities
Law § 1212; 1276). New Jersey’s legislature and high court require that NJT be held liable
to the same extent as a comparably positioned private party (see NJ Stat Ann § 59:2-2;
59:3-1; Maison v New Jersey Transit Corp., 245 NJ 270, 289-291 [2021]). Indeed, under
New Jersey law, NJT is held to a “heightened common carrier” standard of negligence—
as New Jersey’s high court noted, “the duty to provide safe travel to passengers on NJ
Transit buses is no less urgent than the duty imposed on privately owned bus operators”
(Maison, 254 NJ at 291-292). Nevertheless, NJT asks us to dismiss this case on the grounds
- 34 -
- 35 - No. 11
that “New York courts permit the dismissal of actions against the State of New York on
sovereign immunity grounds.”
NJT would require us to apply a special rule exempting it from liability. Its rule
would provide NJT treatment not only more favorable than New York applies to its own
transit authorities but also more favorable than NJT would receive in its own home-state
court. Indeed, under New Jersey’s venue requirements, it is not clear that Ms. Henry would
be entitled to sue NJT by right anywhere, even in the state of New Jersey (see Colt v New
Jersey Tr. Corp., 206 AD3d 126, 128 [1st Dept 2022] [interpreting NJ Rules of Ct rule 4:3-
2 (a)]; but see NJ Rules of Ct Rule 1:1-2 [a] [“Unless otherwise stated, any rule may be . .
. dispensed with by the court in which the action is pending if adherence to it would result
in an injustice”]).
NJT’s insistence that it may be haled in front of New Jersey courts but not New
York courts is not based on any coherent rationale and is in fact somewhat ironic given that
Ms. Henry, a New Jersey resident, is exactly the type of person New Jersey was trying to
protect by waiving NJT’s sovereign immunity. NJT proposes a “policy of hostility to the
public Acts” of New York (Hyatt III, 139 S Ct at 1497, quoting Hyatt II, 578 US 176).
NJT defends its “special and discriminatory rule” with “little more than a conclusory
statement [implicitly] disparaging [New York’s] own . . . judicial” system (Hyatt II, 578
US at 178). “A constitutional rule that would permit this kind of discriminatory hostility
is likely to cause chaotic interference by some States into the internal . . . affairs of others”
(id. at 178-179) by punishing NJT for accidents in Trenton but authorizing it to wreak
- 35 -
- 36 - No. 11
havoc on the streets of Philadelphia or New York City or forcing persons injured in those
other states—even those residing there and never touching New Jersey soil—to press their
claims in New Jersey.
IV.
Instead of offering guidance to lower courts about how to confront that problem, we
have rewritten federal rules of waiver and jurisdiction as well as our own preservation
doctrine to dodge the question. However, the issue is too common and the law too unsettled
for us to evade it for long. Every NJT bus and train has the potential to inflict injuries when
it enters New York. The persistent legal uncertainty surrounding NJT risks leaving those
injured by NJT within NY’s borders without protection and legislators and regulators
without guidance.
We are not, however, the only body that can provide a solution. New York could
negotiate a compact with New Jersey to make NJT unambiguously subject to the
jurisdiction of New York courts. Even more expediently, the New Jersey legislature could
statutorily prevent NJT from asserting sovereign immunity in New York courts, much as
it prevented NJT form doing so in response to certain federal claims (see Robinson v New
Jersey Tr. Rail Operations, Inc., 776 Fed Appx 99, 100 [3d Cir 2019]). As this case
demonstrates, in taking care of New Yorkers, New Jersey would take care of its own.
- 36 -
- 37 - No. 11
Appeal dismissed, without costs, upon the ground that no substantial constitutional
question is directly involved. Opinion by Judge Singas. Acting Chief Judge Cannataro
and Judges Rivera and Garcia concur. Judge Wilson dissents in an opinion, in which
Judge Troutman concurs.
Decided March 21, 2023
- 37 -