New Jersey State Chamber of Commerce v. New Jersey Election Law Enforcement Commission

• Decision Date: 08 May 1980
• Citation: 82 N.J. 57,411 A.2d 168
• Parties: NEW JERSEY STATE CHAMBER OF COMMERCE, a non-profit New Jersey Corporation, et al., Plaintiffs-Appellants, v. NEW JERSEY ELECTION LAW ENFORCEMENT COMMISSION, an agency of the State of New Jersey, et al., Defendants-Respondents.
• Court: New Jersey Supreme Court

Page 57

82 N.J. 57

411 A.2d 168

NEW JERSEY STATE CHAMBER OF COMMERCE, a non-profit New Jersey Corporation, et al., Plaintiffs-Appellants, v. NEW JERSEY ELECTION LAW ENFORCEMENT COMMISSION, an agency of the State of New Jersey, et al., Defendants-Respondents.

Supreme Court of New Jersey.

Argued May 9, 1979.

Decided Feb. 6, 1980.

Order May 8, 1980.

Frederick K. Becker, Woodbridge, for plaintiffs-appellants (Wilentz, Goldman & Spitzer, Woodbridge, attorneys; Marvin J. Brauth and Alan M. Darnell, Woodbridge, on the briefs).

Edward J. Farrell, Legal Counsel, Morristown, for defendant-respondent New Jersey Election Law Enforcement Commission (Edward J. Farrell, attorney and on the brief; Lisa J. Pollak, Morristown, on the brief.)

Erminie L. Conley, Asst. Atty. Gen., for defendant-respondent Attorney General of New Jersey (John J. Degnan, Atty. Gen., attorney).

William S. Singer, Somerville, for defendant-respondent Common Cause (Fuerst & Singer, Somerville, attorneys).

Gloria B. Cherry, Tenafly, submitted a brief on behalf of amicus curiae, League of Women Voters of New Jersey.

The opinion of the court was delivered by

HANDLER, J.

This appeal presents a constitutional challenge on First Amendment grounds directed to provisions of the New Jersey Campaign Contributions and Expenditures Reporting Act, N.J.S.A. 19:44A-1 to 26, which regulate group efforts to influence legislation. Also challenged is an administrative regulation, N.J.A.C. 19:25-12.1(e), that imposes a minimum expenditure of $100 as a threshold condition for enforcement of these provisions of the act.

Each of the courts below, the Chancery Division and the Appellate Division, had a different view of the breadth of the case. The trial court considered the constitutional attack as encompassing not only those provisions of the Campaign Contributions and Expenditures Reporting Act ("the act" or "reporting act") applicable to individuals seeking to influence legislation but also the act's many other provisions dealing with political campaigns and elections. That court held that the act, with certain exceptions, was in both aspects facially overbroad and consequently contravened the First Amendment to the Federal Constitution. 135 N.J.Super. 537, 343 A.2d 796 (Ch.Div.1975). It also ruled that the administrative regulation imposing a specific monetary threshold as a precondition to enforcement was invalid. On appeal, the Appellate Division held that the trial court had improperly undertaken to decide issues which had not actually been raised, i. e., those provisions relating to political election and campaign activities, and it set aside the trial court's invalidation of this aspect of the act. 155 N.J.Super. 218, 221 n.1, 382 A.2d 670 (App.Div.1977) . Further, the Appellate Division disagreed with the trial court with regard to the statutory provisions governing legislative influence. The appellate court acknowledged that while this part of the act was facially overbroad, this objection could be readily overcome through a narrowing judicial construction, Viz, that the act does not apply to persons spending less than $750 in attempting to influence legislation. The court's decision on these grounds thus obviated an additional ruling on the validity of the administrative regulation fixing a lesser monetary threshold.

Plaintiffs come to this Court as of right pursuant to R. 2:2-1(a) and raise several issues on appeal, including an initial contention that they have standing to maintain this action. The major issue presented, however, is whether the provisions of the act designed to regulate conduct seeking to influence legislative action are fatally and irreducibly overbroad under First Amendment precepts. Also questioned is the validity of the administrative regulation calling for enforcement of the act only with respect to such activity involving a minimum expenditure of $100. It is our conclusion that plaintiffs do have standing to pursue this action and, we now hold that, as properly understood and narrowly interpreted, the provisions of the New Jersey Campaign Contributions and Expenditures Reporting Act imposing requirements for reporting and financial disclosure upon persons acting in concert to influence legislation are not unconstitutionally overbroad under the First Amendment to the United States Constitution. We further hold that there is under the act so construed discretionary administrative power to impose a monetary enforcement threshold but that the administrative regulation setting a $100 threshold is too low and is therefore an invalid exercise of administrative authority.

I

Defendants take the position that the plaintiffs lack standing to maintain this action which seeks to have certain provisions of the New Jersey Campaign Contributions and Expenditures Reporting Act declared unconstitutional. The statute, L.1973, C. 83, N.J.S.A. 19:44A-1 Et seq., was enacted in 1973 as a major governmental reform. It regulates campaign expenditures by candidates for political office and imposes a wide range of restraints, including financial reporting and disclosure, upon persons who seek to influence the election of political candidates, the outcome of elections for the passage or defeat of public questions, and the content and fate of legislation.

With respect to individuals seeking to influence legislation, the immediate focus of this appeal, the statute defines "any two or more persons acting jointly . . . to influence the content, introduction, passage or defeat of legislation" as constituting a "political information organization." N.J.S.A. 19:44A-3g. It requires that such a political information organization, "before receiving any contribution or expending any money to . . . influence the content, introduction, passage or defeat of legislation, appoint one treasurer and designate one depository and file the name and address thereof with the Election Law Enforcement Commission." N.J.S.A. 19:44A-13. "No contributions or other thing of value" can otherwise "be received by a political information organization", nor can any "expenditure . . . be made" by such an organization "except through (its) duly appointed treasurer." N.J.S.A. 19:44A-14. Each political information organization must also file a "full report" with the Election Law Enforcement Commission detailing all contributions received and all expenditures made or incurred by it in seeking "to influence" legislation. N.J.S.A. 19:44A-8. This report must also contain the names and addresses of all persons or entities having contributed more than $100 and the names and addresses of persons and groups "to whom expenditures have been made and the amount and purpose of each such expenditure" as well as all receipts and expenditures generated by testimonial affairs. Ibid. If the political information organization also seeks to provide "political information concerning any candidate or candidates for public office or with respect to any public question", N.J.S.A. 19:44A-3g, it must then file another series of reports. N.J.S.A. 19:44A-16b, 19:44A-17, and 19:44A-18. Additional reports must be filed with the Commission by the depository of such organizations whenever a deposit has been made by its treasurer, N.J.S.A. 19:44A-15, and whenever a public solicitation has been authorized by such an organization. N.J.S.A. 19:44A-19. The act does not apply, however, to a "bona fide" representative of the news media in connection with the dissemination of material "in the normal course of its business" or to educational entities conducting classes, educational events, and the like. N.J.S.A. 19:44A-3g. Also excluded from the act's coverage are persons acting alone who expend no more than $100 exclusive of travel expenses. N.J.S.A. 19:44A-14.

The lead plaintiff in this action is New Jersey Chamber of Commerce; other plaintiffs are major trade associations, a labor union local, a private business corporation, a citizens' group, a taxpayer's organization, a sportsmen's federation, and several individuals, two mayors and a husband and wife. Defendants in the action are the New Jersey Election Law Enforcement Commission ("the Commission"), the administrative agency responsible for the act's enforcement, and Common Cause and the State Attorney General, who intervened as parties-defendant. The complaint alleged that each of the plaintiffs in varying capacities had attempted to influence the course of legislation and further intended to do so in the future, and also, that some of the plaintiffs on occasion had attempted to influence the outcome of campaigns on public questions. Consequently, some of the plaintiffs were "political committees" (N.J.S.A. 19:44A-3i) as well as "political information organizations" under the act. The major contention was that the act on its face is violative of the First Amendment to the United States Constitution and our State counterpart, Art. I, pars. 6 and 18 of the New Jersey Constitution (1947). The primary relief sought was a declaration that the act was unconstitutional on its face and in its application to plaintiffs.

Prior to the pretrial conference, the Commission pursuant to its statutory rule-making authority under N.J.S.A. 19:44A-6b, promulgated rules and regulations dealing with a broad range of matters. These included N.J.A.C. 19:25-4.7 which dealt with communications by corporations and labor organizations with stockholders or members; N.J.A.C. 19:25-1.7 restricted the definition of legislation to state-level enactments. The contributions of goods and services were the subjects of N.J.A.C. 19:25-11.4. Another rule, N.J.A.C. 19:25-12.1, exempted from reporting "a political information organization whose expenditures for political activity during the calendar year did not exceed $100.00" exclusive of the "traveling expenses of any member of such political information organization . . . if such traveling expenses are voluntarily paid by such member . . ....