Does a court that finds a private nuisance causing substantial continuing damage to neighboring landowners have the equitable power to deny an absolute injunction and instead condition the injunction on the defendant's payment of permanent damages, where the economic disparity between the harm and the cost of enjoining the polluter is great?

Atlantic Cement Co. (defendant) operated a large cement plant near Albany, New York, with an investment exceeding $45,000,000 and more than 300 employees. Neighboring landowners (plaintiffs) alleged that dirt, smoke, and vibration emanating from the plant injured their properties. After trial, the court found that the plant constituted a nuisance and that plaintiffs had been substantially damaged. However, the total damage to plaintiffs' properties was relatively small compared to the value of defendant's operation and the consequences of closing the plant. The trial court awarded temporary damages for harm incurred up to trial and found permanent damages to all plaintiffs totaling $185,000, to be used as a possible basis for settlement if both sides stipulated. No stipulation resulted. The trial court denied an injunction because of the large disparity between the economic consequences of the nuisance and those of the injunction. The finding of the trial court was that the plant had installed the most modern dust control devices available.

Plaintiffs, neighboring landowners, brought two actions in Supreme Court, Albany County, seeking an injunction and damages against the cement company. After trial at Special Term, the court found a nuisance, awarded temporary damages, and denied an injunction. The Appellate Division affirmed the finding of nuisance and the denial of the injunction. Plaintiffs appealed to the New York Court of Appeals. The Court of Appeals reversed the orders, without costs, and remitted both cases to Supreme Court, Albany County, to grant an injunction to be vacated upon defendant's payment of permanent damages determined by the court.

(Bergan, J.)

Yes. A court of equity may grant an injunction conditioned on the defendant's payment of permanent damages to the plaintiffs, rather than enjoining the nuisance absolutely, where the damage is small relative to the cost of abatement.

The traditional New York rule, reaffirmed in Whalen v. Union Bag & Paper Co., 208 N.Y. 1 (1913), is that a nuisance causing substantial damage will be enjoined despite a marked disparity between the economic effect of the injunction and the nuisance. Denial of the injunction outright cannot be sustained without overruling that doctrine, and doing so would permit repeated successive damage actions. Following the rule literally, however, would close the plant at once, a drastic result the court seeks to avoid.

An injunction postponed for a short period to allow technical improvements is unsatisfactory. There is no assurance that any significant improvement would occur, because dust-control techniques depend on the research of the entire cement industry nationwide, not on defendant alone. Courts would face repeated extension applications and would be hard pressed to close a single plant if the whole industry had found no solution.

Granting the injunction unless defendant pays permanent damages does justice between the parties and redresses all the economic loss to plaintiffs' properties, past and future. The power to condition an injunction on payment of permanent damages is supported by McCarty v. Natural Carbonic Gas Co. and Strobel v. Kerr Salt Co., by the elevated railway cases (Pappenheim v. Metropolitan El. Ry. Co., Ferguson v. Village of Hamburg), and by Northern Indiana Public Serv. Co. v. Vesey. The payment compensates for a servitude on the land and precludes future recovery by plaintiffs or their grantees. The risk of paying permanent damages also spurs research into abatement techniques. The remedy is limited to these parties and does not foreclose public agencies from seeking relief. Courts are also neither equipped nor positioned to solve general air pollution through a private suit. Accordingly, the orders are reversed and the cases remitted to grant an injunction vacated upon payment of permanent damages.

Dissent (Jasen, J.) The long-established New York rule requires an injunction where a nuisance causes substantial continuing damage, and the majority's permanent damages doctrine abandons it. Permitting the cement company to continue polluting upon payment of a fee licenses a continuing wrong and removes the incentive to abate it (the majority answered that the risk of paying permanent damages would itself spur research into improved techniques). Air pollution, particularly particulate contamination, is a serious public health hazard, and the Legislature's Air Pollution Control Act declares a state policy to require all available and reasonable methods to control it. The authorities relied on by the majority involved uses primarily for public benefit, whereas the cement company operates primarily for private gain. Inverse condemnation and the imposition of a servitude on land without the owner's consent are not constitutionally permissible for private use, as the State Constitution (art. I, § 7) permits taking only for public use with just compensation. Jasen would grant an injunction to take effect 18 months hence unless the nuisance is abated by improved techniques, noting that the company knew of plaintiffs' presence when it built the plant and that industry should plan to eliminate contamination of the air and damage to neighbors.