Rivkin v. Dover Tp. Rent Leveling Bd.

• Court: United States State Supreme Court (New Jersey)
• Writing for the Court: O'HERN; Of course, as do we
• Citation: 143 N.J. 352,671 A.2d 567
• Decision Date: 29 February 1996
• Parties: , 64 USLW 2571 David RIVKIN, Edward Rivkin, and Judith Rivkin, t/a Galaxy Manor, a New Jersey Partnership, Plaintiffs-Appellants, v. DOVER TOWNSHIP RENT LEVELING BOARD, Defendant-Respondent.

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143 N.J. 352 671 A.2d 567, 64 USLW 2571 David RIVKIN, Edward Rivkin, and Judith Rivkin, t/a Galaxy
Manor, a New Jersey Partnership, Plaintiffs-Appellants,
v.
DOVER TOWNSHIP RENT LEVELING BOARD, Defendant-Respondent. Supreme Court of New Jersey. Argued Oct. 24, 1995.
Decided Feb. 29, 1996.

Reuel E. Topas, Jackson, for appellants (Levin, Shea, Pfeffer, McMahon and Russell, attorneys).

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Courtland T. Babcock, II, Tuckerton, for respondent (Babcock, Hennes & Bielory, attorneys).

Bruce D. Greenberg, Woodbridge, for amicus curiae Hudson County Taxpayers' Association (Greenbaum, Rowe, Smith, Ravin & Davis, attorneys).

Stuart R. Koenig, Cedar Grove, for amici curiae New Jersey State League of Municipalities and New Jersey Institute of Municipal Attorneys (Stickel, Koenig & Sullivan, attorneys).

Margaret B. Carmeli, Middletown, submitted a brief on behalf of amicus curiae The New Jersey Manufactured Housing Association (Giordano, Halleran & Ciesla, attorneys; Paul H. Schneider, of counsel; Ms. Carmeli and Debra J. Rubenstein, on the briefs).

The opinion of the Court was delivered by

O'HERN, J.

The question in this appeal is whether a party that has appeared before a local rent leveling board has a claim under the Federal Civil Rights Act, 42 U.S.C. § 1983, for an unconstitutional deprivation of property when a member of the board has acted in a biased manner and the other members of the board did not remove or disqualify the member lacking in impartiality. The question is related to that concerning an allegedly unconstitutional tax assessment in General Motors v. Linden, 143 N.J. 336, 671 A.2d 560 (1996), also decided today. In General Motors, we relied on National Private Truck Council, Inc. v. Oklahoma Tax Comm'n, 515 U.S. 582, 115 S.Ct. 2351, 132 L.Ed.2d 509 (1995), to conclude that there was no basis for courts to award relief under § 1983 when an adequate state legal remedy exists to correct an arbitrary tax assessment. We find that similar principles of federalism lead generally to the same conclusion in the context of land use controls.

The primary issue is whether the doctrine of Parratt v. Taylor, 451 U.S. 527, 101 S.Ct. 1908, 68 L.Ed.2d 420 (1981), applies in this context of municipal rent controls. Parratt holds that when a deprivation of property results from the random and unauthorized

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actions of a state employee and pre-deprivation process would have been impracticable, there is no due process violation so long as an adequate post-deprivation remedy is available. We hold that, absent egregious misconduct that shocks the conscience in the sense of violating civilized norms of governance, or invidious discrimination on the part of a board member or board, so long as the State provides a plain, adequate and timely remedy to redress irregularities in the proceedings, a party aggrieved by the determinations of a municipal rent leveling board does not have a claim for relief under 42 U.S.C. § 1983. I

David Rivkin, Edward Rivkin, and Judith Rivkin are partners in Galaxy Manor, a mobile home park in Dover Township. Dover Township has a Mobile Home Park Rent Leveling Ordinance ("Code") that requires landlords to apply to the Dover Township Rent Leveling Board ("Board") for rental increases. Dover Code § 104-35A provides that the Board be made up of one mobile home park landlord, one mobile home park tenant, and three non-affiliated public members.

In May 1990, the Rivkins filed an application with the Board for a rent increase based on $59,624.96 of capital improvements to the [671 A.2d 571] Galaxy Manor mobile home park. The Code provides:

A landlord may seek an additional charge for major capital improvements.... The landlord seeking a capital improvement surcharge shall appeal for said surcharge to the Rent Leveling Board, which shall determine ... if said improvement is a major improvement and, if so, the amount of increase granted for such major improvement and establish the conditions of such increase.

Dover Code § 104-34B.

The Board conducted four hearings on the application in June, July, August and October, 1990. Edward Baltarzuk, the mobile home park tenant member of the Board, took an active part in the proceedings. Baltarzuk, who was actually a resident of the Galaxy Manor Mobile Home Park, appeared to view his position on the Board as one of advocacy rather than adjudication. He stated on the record that it was his function to "serve the people of the

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mobile home park." He continually challenged the Rivkins and their representatives both on a personal basis, referring to their attorney as a "yo-yo," and on a partisan basis, introducing facts from outside the record.

Baltarzuk's manner was threatening to the Rivkins. He said: "You are looking for trouble and you are going to get it." Baltarzuk urged a tenant witness to file a complaint against the Rivkins for violating equal housing opportunity laws. The following is a typical antagonistic exchange between the Rivkins and Baltarzuk:

Mr. Levin (attorney for Rivkin): That is our application. Our obligation is to provide this application--

Mr. Baltarzuk: You are supposed to file the truth, sir.

Mr. Levin: Before you call anyone a liar, you are the fellow that is challenging our application without giving us the benefit of telling us where you get the information.

Mr. Rivkin, is the rental structure as contained within the application true and accurate?

Mr. Rivkin: As of the first of May, yes.

Mr. Baltarzuk: Therefore, this application should not even be heard. It is an illegal rental increase. I have a person right here in the audience who is paying a wrong rent. How can she pay 275? You are telling me here she is paying 223.

Mr. Levin: I find this incredible, that somebody who has to make a judgment here has apparently taken it upon himself to go out and solicit whatever it is your [sic] trying to tell us ....

Baltarzuk, in essence, offered himself as a witness concerning certain items and was, in effect, testifying in the proceedings.

The Rivkins requested that Baltarzuk be removed from the proceedings. The Board denied these requests and, with Baltarzuk participating, granted $20,641.42 in rent increases for capital improvements, finding that the majority of the Rivkins' application constituted "capital expenditures" rather than "major capital improvements" under the ordinance. Capital expenditures may not be recovered by rent increases.

The Rivkins appealed to the Law Division to determine the amount of the rental increase. They claimed that the "arbitrary, capricious, and unreasonable" findings of the Board and the failure

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of the Board to disqualify Baltarzuk for his obvious bias constituted a civil rights violation allowing recovery of damages and attorney's fees under 42 U.S.C. § 1983.

The Law Division reserved decision on the application for attorney's fees but agreed that Baltarzuk's misconduct and manifest bias had tainted the proceedings. However, it refused to make a substantive determination on the rental increase. It ruled that the Board members were not biased and would not be influenced once Baltarzuk was removed. The court remanded the matter to the Board with all issues to be reconsidered without the participation of Baltarzuk. The Appellate Division denied the Rivkins' motion for leave to appeal the remand order. The hearings proceeded on remand without the participation of Baltarzuk. Upon rehearing, the Board approved an additional increase of $25,089.67 for a total of $45,731.09. The Law Division then disposed of the issue of attorney's fees and constitutional damages. In its [671 A.2d 572] bench opinion, the Law Division found that Baltarzuk's actions had "permeated the Board," "that the Board was recalcitrant with respect to th[e] matter" of his participation, and had "violated the plaintiffs' due process rights." It awarded $39,679.55 in counsel fees and $6,303.34 in compensatory damages under 42 U.S.C. §§ 1983, 1988.

Both parties appealed. The Rivkins appealed the remand to the Board, claiming that the Law Division should have made the substantive determination of the rental increase because the entire Board had been tainted by Baltarzuk's bias. The Board appealed the imposition of § 1983 relief and attorney's fees.

The Appellate Division affirmed the remand order, but found that the plaintiffs had suffered no due process violation under § 1983, and therefore were not entitled to attorney's fees or compensatory damages. 277 N.J.Super. 559, 570, 649 A.2d 1356 (1994). Basing its ruling on Parratt v. Taylor, 451 U.S. 527, 101 S.Ct. 1908, 68 L.Ed.2d 420 (1981), the Appellate Division found the actions of Baltarzuk to be "random and unauthorized," that the plaintiffs had had an adequate post-deprivation remedy under

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state law, and that the requirements of procedural due process had been satisfied. We granted plaintiffs' petition for certification. 140 N.J. 275, 658 A.2d 299 (1995). II

Section 1983 is the modern codification of the first section of legislation passed as part of the Ku Klux Klan Act of 1871 ("the Act"). ¹ The Act, entitled "an Act to enforce the Provisions of the Fourteenth Amendment to the Constitution of the United States, and for other Purposes," addressed conditions then prevalent in some of the Southern States. Monroe v. Pape, 365 U.S. 167, 171-73, 81 S.Ct. 473, 476-77, 5 L.Ed.2d 492, 497 (1961) (quotation omitted). At that time, former slaves and their descendants were subjected to egregious violations of liberty and property, and state governments were either incapable or unwilling to protect these citizens. During debate in the House of Representatives, Mr. Beatty, a Member of Congress from Ohio, summarized the conditions that the Act was meant to address:

Men were murdered, houses were burned, women were outraged, men were scourged, and officers of the law shot down; and the State made no successful effort to bring the...