The Supreme Court ruled unanimously in favor of New Jersey on Tuesday, saying the state can unilaterally withdraw from a decades-old agreement surrounding New York Harbor.
Justice Brett Kavanaugh wrote for the unanimous majority that a ruling for New York would have allowed the Empire State essentially to hold its neighboring state hostage. The agreement, known as the Waterfront Commission, was established in the 1950s to combat organized crime at the harbor.
SUPREME COURT SYMPATHETIC TO NEW JERSEY’S PLEA TO BREAK COMPACT WITH NEW YORK
New Jersey contended that the commission has outrun its usefulness, claiming the compact limits harbor business and has caused labor shortages. The issue at hand was that the commission did not specifically address whether either state can decide on its own to withdraw.
“In sum, background principles of contract law, reinforced here by principles of state sovereignty and the fact that the States did not intend for the Compact to operate forever, indicate that New Jersey may unilaterally withdraw from the Waterfront Commission Compact,” Kavanaugh wrote for the full court, marking a win for shipping companies and a union that represents dock workers.
During oral arguments over the case in March, justices on the 6-3 Republican-appointed high court appeared to lean more sympathetic to New Jersey’s claims.
The commission’s primary function oversees licensing and inspections at the Port of New York and New Jersey and has its own police force, employing around 70 people.
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Former Gov. Chris Christie (R-NJ) signed legislation in 2018 withdrawing the state from the compact before the Empire State took the matter to the Supreme Court to resolve the dispute.
A majority of the port’s business today goes through the New Jersey side, a difference from when the compact was initially drafted in 1953, when roughly 70% of the port’s business came through the New York side. Today, around 80% of cargo goes through the New Jersey side.
