text:
    IN THE MATTER OF THE TENURE HEARING OF PAULA M. GROSSMAN, A/K/A PAULA M. GROSSMAN, SCHOOL DISTRICT OF THE TOWNSHIP OF BERNARDS, SOMERSET COUNTY.
    Superior Court of New Jersey Appellate Division
    Argued January 15, 1974—
    Decided February 20, 1974.

      Before Judges Carton, Seidman and Demos.

      Mr. Richard J. Schacter argued the cause for appellant and cross-respondent Paula M. Grossman (Messrs. Halpern, Schacter & Wohl, attorneys; Mr. Lee Trucker, on the brief).

      Mr. Gordon A. Millspaugh, Jr., argued the cause for respondent and cross-appellant Bernards Township Board of Education (Messrs. Young, Rose & Millspaugh, attorneys; Mr. Theodore Margolis, on the brief).

      Ms. Erminie L. Conley, Deputy Attorney General, argued the cause for the State Board of Education (Mr. George F. Kugler, Jr., Attorney General of New Jersey, attorney; Mr. Stephen Skillman, First Assistant Attorney General, of counsel).
   The opinion of the court was delivered by

Seidman, J. A. D.

The principal issue in this novel case is whether a male tenured teacher who underwent sex-reassignment surgery to change his external anatomy to that of a female can be dismissed from a public school system on the sole ground that his retention would result in potential emotional ’harm to the students.

Paul Monroe Grossman, now 54= years of age, married, and the father of three children, was engaged as a teacher by the Bernards Township Board of Education in 1957 and received tenure in 1960. He taught vocal music in one of the elementary schools, primarily to fourth, fifth and sixth-grade children between the ages of 10 and IS.

Eor many years Grossman had had a gender identity problem which worsened with the passage of time until, shortly after his fiftieth birthday, he sought medical advice, commenced a course of treatment, and, in March 1971, had sex-reassignment surgery performed. He had been diagnosed as a transsexual; that is, one who anatomically is born with the genitalia of one sex but who believes himself (or herself) to be a member of the other sex.

Although Grossman had notified his superiors of his impending absence for surgery, he did not disclose its nature until his return in late April or May of 1971, when he informed the township superintendent of schools and made known his intention of remaining in the school system as a female. After completing the academic year in male attire, he assumed the name of Paula Miriam Grossman and began to live openly as a woman.

During the summer of that year the matter was under active and continuous consideration by the board, looking toward a satisfactory resolution of the problem. A series of meetings took place between it and Mrs. Grossman (it seems appropriate to use the female gender henceforth), arrangements were made for her to be examined by board selected psychiatrists, and finally a proposal was submitted by the board to engage her on a one-year contract at the same pay to teach the same courses, but only on an elective basis in the high school, provided she would resign, thus relinquishing her tenure, and obtain a new teaching certificate in her female name. The offer was rejected.

On August 19, 1971 the board filed written charges against Mrs. Grossman and suspended her without pay. The charges, in substance, were: (1) her presence as a teacher had created and would continue to create a degree of sensation and notoriety within the system and the community which would severely impair the board’s ability to conduct an efficient and orderly school system; (2) under the circumstances of the case, including the failure to disclose the condition and anticipated surgery, Mrs. Grossman had exhibited conduct unbecoming a teacher; (3) as a result of the sex-reassignment surgery, Mrs. Grossman underwent a fundamental and complete change in her role and identification, thereby rendering herself incapable of continuing to function as Paul Monroe Grossman, the person who had been engaged as- a teacher by the board; (4) Mrs. Grossman exhibited conduct and behavior deviant from the acceptable standards of the community, and (5) she exhibited abnormality. Each of these charges, it was asserted, constituted just cause for dismissing her from the school system.

Pursuant to N. J. S. A. 18A :6-10 et seq. the charges were forwarded to the State Commissioner of Education. After a lengthy hearing before Assistant Commissioner William A. Shine, the third charge, on Dr. Shine’s own motion and without objection, was amended to reflect an issue tried and argued but not specified in the statement of charges, as follows-:

Paul Monroe Grossman knowingly and voluntarily underwent a sex-reassignment from male to female. By doing so, he underwent a fundamental and complete change in his role and identification in society, thereby rendering himself incapable to teach children in Bernards Township because of the potential her (Grossman’s) presence in the classroom presents for psychological harm to the students of Bernards Township. Therefore, Paula a/Jc/a Paul Monroe Grossman should be dismissed from the system by reason of just cause due to incapacity. [Emphasis supplied.]

The Commissioner found that the first charge was not supported by the evidence, noting, among other things, that despite evidence offered by the board of widespread newspaper and television publicity, threats of legal action by parents, and adverse reactions to Mrs. Grossman among the teachers and other personnel in the system, there was an absence of public protest at open board meetings during the summer of 1971, and, particularly, the board had offered to continue her employment on a limited basis in the high school. He deemed this inconsistent with the contention that disruption would occur if Mrs. Grossman should be retained in the school system.

He found that the charge of conduct unbecoming a teacher had also not been substantiated. Although, in his opinion, it would have been better had Mrs. Grossman taken the administration into her confidence, he concluded that the evidence did not support the charge that her behavior was a deliberate attempt to mislead her colleagues and the administration.

The Commissioner rejected as well the charges alleging deviant conduct and abnormality as not having been established by the weight of the evidence. He stressed the findings of three psychiatrists with unchallenged qualifications who had examined Mrs. Grossman at the requect of the board (which now attacks their reports for “gross insufficiency”) and who concluded virtually unanimously that there was no evidence of physical or mental abnormality which would render Mrs. Grossman unable to pursue her profession as a teacher. As for the conduct allegedly “deviant from the aceepted standards of the community,” the Commissioner, recognizing that “conventional standards are seriously affected in the instant matter,” nevertheless refused to substitute his judgment for that of the experts who had examined Mrs. Grossman and found no abnormality serious enough to prevent her from teaching.

He concluded, however, that the amended thrid charge, which we shall discuss in more detail later, had been proved and that Mrs. Grossman was incapacitated to teach children because of potential psychological harm to the students. He directed that she be dismissed as a teacher in the Bernards Township school system “for reason of just cause due to incapacity.”

Taking into account the unusual nature of the ease and finding no moral turpitude, the Commissioner further directed the board to apply to the Teachers’ Pension and Annuity Pund for a disability pension in behalf of Mrs. Gross-man, pursuant to N. J. S. A. 18A:66-39 et seq. He also ordered the payment of hex back pay based upon his interpretation of L. 1971, c. 435 (amending N. J. S. A. 18A :6-14).

Both sides appealed. The State Board of Education affirmed that portion of the decision ordering the dismissal of Mrs. Grossman (one member, however, being of the view that the evidence sustained the fourth and fifth charges) and also the direction for the application to the Teachers’ Pension and Annuity Pund. With four members dissenting, the order to pay Mrs. Grossman’s back salary was reversed.

Mrs. Grossman now appeals to this court from the order of dismissal and the denial of back pay. The local board cross-appeals from the rejection of the other four charges.

I

The scope of our review is clear with respect to the Commissioner’s disposition of the five charges. The governing standard is, of course, whether the findings made could reasonably have been reached on sufficient credible evidence present in the record, considering the proofs as a whole, with due regard to the opportunity of the one who heard the witnesses to judge of their credibility. Close v. Kordulak Bros., 44 N. J. 589, 598-599 (1965). If the factual findings are supported by competent evidence, they will be upheld. Atkinson v. Parsekian, 37 N. J. 143, 149 (1962); Clover Hill Swimming Club v. Goldsboro, 47 N. J. 25, 36 (1966); Szumski v. Dale Boat Yards, Inc., 48 N. J. 401, 410 (1967). It is not ordinarily our function to weigh the evidence, to determine the credibility of witnesses, to draw inferences and conclusions from the evidence, and to resolve conflicts therein. Mead Johnson and Co. v. South Plainfield, 95 N. J. Super. 455, 466 (App. Div. 1967). We have, though, the responsibility of determining whether pertinent principles of law were properly interpreted and applied to the facts as found by the trier thereof. See Jantausch v. Verona, 41 N. J. Super. 89, 96-97 (Law Div. 1956), aff’d 24 N. J. 326 (1957).

Mrs. Grossman argues that (1) it was error to hold that a tenured teacher may be dismissed for just cause due to incapacity solely upon evidence that the presence of the teacher in the classroom presented a possibility of emotional harm to some students, (2) the evidence adduced was insufficient to establish such emotional harm, and (3) hypothetical psychiatric testimony of such harm was not a sufficient ground for her removal. On its cross-appeal the board maintains that the other charges should have been sustained on the evidence presented.

Applying the above-mentioned standard of review to the board’s contention that the first, second, fourth and fifth charges should not have been dismissed, we cannot say, after a thorough canvass of the record, that the Commissioner’s findings as to them are so lacking in evidentiary support as to require modification or reversal. We are satisfied from the proofs in the case that there was a rational basis for the conclusions reached.

As for the amended third charge, the Commissioner found from the evidence that Mrs. Grossman was “incapacitated to teach children in the situation described herein because of the potential her presence in the classroom presented for psychological harm to the students of Bernards Township.” His decision must be measured by the same standard — that is, whether it was supported by sufficient credible evidence considering the entire record.

The testimony on that issue was in sharp conflict. Dr. Charles W. Socarides, a psychiatrist and psychoanalyst with extensive qualifications and experience in the treatment of sexual disorders, appeared in behalf of the board, as did Dr. Harvey Martin Hammer, a psychiatrist specializing in the treatment of children. Dr. Charles L. Ihlenfeld, a physician who described himself as board eligible but not certified in the field of internal medicine, appeared for Mrs. Gross-man, and Dr. Robert W. Laidlaw, a well-qualified psychiatrist, testified in her behalf by deposition. Although much of what they said dealt with the nature and treatment of transsexualism as well as the propriety of sex-reassignment surgery, we are primarily concerned here with their views on the impact upon students of a teacher who has undergone such surgery.

Dr. Socarides, who considered transsexualism to be a psychiatric syndrome characterized by an overriding wish to be a person of the opposite sex, expressed the view that the presence in the school system of a transsexual teacher who had been sexualty reassigned could create “some anxieties among those [young children] already predisposed due to their own inter-emotional conflicts over their castration fears and so forth.” He said, further, that “since sexual gender role is of paramount significance in life, and its formation and helping it and its growth is so important, as I mentioned before, that such things could cause disturbance.” The problems, he added, would be difficult to identify and measure by school authorities since some of the changes might be long-term ones. On the subject of the relationship between a teacher and young children, Dr. Socarides said:

* * * [Llooking at it from another point of view is that there is another side to this story and that is that the teacher’s function as objects for identification and one of the major things in teaching is that we learn through identification with the teacher and very often we learn out of love for the teacher. And, boj'S not only learn their lessons in school but they learn how to be men from their teachers and they learn how to be men of certain types of character or personality or aspirations or they learn in a negative fashion. That’s why the teacher is, perhaps, the highest profession * * * and it’s this process of identification to young minds which — the whole liking for learning develops out of love for the teacher and identity with the teacher. * * !i" and I think it ■— if such sexual change were known, I think it would be very disruptive of that process, if that were known.

Dr. Hammer said that sexual identity problems, varying in severity, were commonplace in cbildren. With respect to the impact of a sexually reassigned transsexual teacher whose former sexual identity was known to the children, it was his impression “that such an individual would have a very negative effect on the mental health of the children in the classroom.” He cited, as an example, the case of a 14-year-old boy in the Bernards Township school system who had had a severe self-image problem and who suffered a set-back after learning of what had happened to Mrs. Grossman. He said, further, that a child’s relationship with the teacher was a significant factor in the learning process and that when a teacher does not have psychological control over the children in the classroom potential learning aspects are diminished. It was his opinion that “it would he disadvantageous to the mental health of the children in the Bernards Township school system to have Mrs. Grossman reappear in her new gender as a teacher in that school system.”

A contrary position was taken by Dr. Ihlenfeld, who testified that there would he no adverse effect on children who knew of Mrs. Grossman’s sex change because their own sense of gender identity had been formed and fixed long before they reached her classroom. He said further that “if a child should be so upset by the thought that Mrs. Grossman had surgery, then this may be the child who has a potential for developing a problem and should have counselling anyway.”

Dr. Laidlaw was also of the opinion that Mrs. Grossman would have no significant effect on children aged 10 to 12 years who had known her as a man. While there might be initial “snickering or gossipping or wise-cracking,” this, he said, would be transitory and would not detract from Mrs'. Grossman’s “effectiveness as a teacher on the children.”

The Commissioner, acknowledging the conflicting evidence on the issue, found that the testimony of the experts was predicated on their differing concepts of the role of the teacher, with Dr. Socarides and Dr. Hammer both viewing the teacher as a “paradigmatic” person whose very presence in the classroom is instructive, whereas, to Dr. Ihlenfeld, a teacher in the classroom was merely another person from the outside world. He chose to accept Dr. Socarides’s description of the role of a teacher, and he relied heavily on the testimony of Dr. Hammer in reaching his conclusion that Mrs. Grossman’s presence in the classroom could potentially result in psychological harm to the students.

Mrs. Grossman argues that there was a lack of substantial evidence to support the Commissioner’s conclusion and that the proofs did not warrant the removal of a teacher otherwise “found to be capable, efficient, and physically able to perform her duties.” It is urged that there is little or no empirical data or evidence to indicate that psychological or emotional harm would result to the students of Bernards Township if Mrs. Grossman were allowed to teach in the school system.

It is not within our competency to balance the persuasiveness of the evidence on one side as against the other. The choice of accepting or rejecting the testimony of the witnesses rests with the administrative agency subject to our oversight of whether there was substantial, legal evidence to support the conclusions reached. Hornauer v. Div. of Alcoholic Beverage Control, 40 N. J. Super. 501, 506 (App. Div. 1956); Middletown Tp. v. Murdoch, 73 N. J. Super. 511, 515 (App. Div. 1962). The issue was thoroughly presented and argued by both sides. The Commissioner resolved the conflicting medical evidence in favor of the board. Understandably, in a case of this nature, most of the supporting evidence was in the form of opinions given by medical experts, as, indeed, was the opposing evidnece. We do not believe that those opinions were based on conjecture or speculation. We are convinced that the evidence adduced sustained as reasonably probable the board’s hypothesis that there would be emotional harm to the students if Mrs. Gross-man were retained in the school system. See Ciuba v. Irvington Varnish & Insulator Co., 27 N. J. 127, 139-140 (1958). Consequently, we will not disturb the Commissioner’s finding.

II

Having reached the above conclusion, we must now determine whether the finding that Mrs. Grossman’s retention as a teacher in Bernards Township schools would have an adverse emotional effect upon her students justifies her dismissal “for reason of just cause due to incapacity.” Central to this issue is N. J. S. A. 18A :6—10, which provides in pertinent part that no person under tenure shall be dismissed “during good behavior and efficiency” except “for inefficiency, incapacity, unbecoming conduct, or other just cause.” In the context of this case, the focal point among these grounds is “incapacity.”

Mrs. Grossman’s counsel argues that the word “incapacity,” as used in the tenure statute, relates to the teacher’s inability to teach in the classroom and not to his or her purported impact upon the “psyche” of the students as individuals. He further argues that since Mrs. Grossman did not lack the ability, professionally, physically or mentally, to continue to function as a teacher, and since no illegal, immoral or deviant act or conduct had been established, she cannot be dismissed under. the statute notwithstanding the finding that her presence in the classroom would have an adverse effect on the students. We think counsel's view of the statute is too narrow.

The term “incapacity,” within the purview of the statute, has not received either precise definition or specific standards in this jurisdiction. However, in construing it we should not confine our attention to the term itself. We must examine it in the light of the statutory surroundings and objectives. See Ward v. Scott, 11 N. J. 117, 123 (1952). It should receive a reasonable and sensible interpretation, and should, moreover, be considered in conjunction with the words “just cause.”

In Berardi v. Rutter, 42 N. J. Super. 39 (App. Div. 1956), aff’d sub nom. In re Berardi, 23 N. J. 485 (1957), the court said:

* * * [T]here are a considerable number of statutes throughout the country authorizing the removal of an officer or employee for “cause,” and that under them “cause” is generally held to mean “just cause” or such cause as is “plainly sufficient under the law and sound public policy” (Haight v. Love, 39 N. J. L. 14, 22 (Sup. Ct. 1876), affirmed at 39 N. J. L. 476 (E. & A. 1877) ; Ayers v. Newark, 49 N. J. L. 170, 171, 172 (Sup. Ct. 1886) ; Brokaw v. Burk, 89 N. J. L. 132, 135 (Sup. .Ct. 1916) ; Russo v. Meyner, 22 N. J. 156, 179, 181 (1956) Heher, J. in a dissenting opinion)), excluding therefore arbitrary or capricious action. Moreover, the term there is generally held to have reference to the office or employment or to its administration, Russo v. Meyner, supra, 22 N. J., at page 179; and many other cases in accord, some of which are cited in 43 Am. Jur. 47; 67 C. J. S. Officers § 60, p. 248 ; 46 C. J. 986; 4 McQuillin, Municipal Corporations (3rd ed.), 256, 257. * * * As thus defined, the term “cause” resembles in some respects the standard of “good character, competency and integrity” now under consideration. [42 N. J. Super, at 47 emphasis supplied]

Dismissal of teachers for “inefficiency, incapacity, condnct unbecoming a teacher or other just cause,” as found in N. J. S. A. 18A :6—10, has been held to provide a sufficient standard which, though “general in terms but measured by common understanding * * * fairly and adequately conveys its meaning to all concerned.” Laba v. Newark Board of Education, 23 N. J. 364, 384 (1957). It is clear from a reading of that case that the touchstone is fitness to discharge the dirties and functions of one’s office or position.

It is true that Mrs. Grossman’s proficiency as a teacher is not in question and, as noted previously, she had been found physically and mentally competent to teach. It is also true that misconduct on her part has not been established. Although dictum in School Dist. Wildwood v. Slate Board of Education, 116 N. J. L. 572 (Sup. Ct. 1936), suggests that dismissals should be limited to proof of some form of dereliction on the part of the teacher, there is neither case nor statutory law so restricting the power of the Commissioner under N. J. S. A. 18A :6-10.

The problem to be resolved is whether “incapacity” of a teacher, as that term is used in the statute, can be established solely by a finding that the teacher will have an adverse effect upon the students in the classroom.

“Incompetency,” a term closely allied to “incapacity,” was defined in Horosko v. Mt. Pleasant School District, 335 Pa. 369, 6 A. 2d 866 (Sup. Ct. 1939), cert. den. 308 U. S. 553, 60 S. Ct. 101, 84 L. Ed. 465 (1939) :

The term “incompetency” has a “common and approved usage.” The context does not limit the meaning of the word to lack of substantive knowledge of the subjects to be taught. Common and approved usage give a much wider meaning. Dor example, in 3J G. J., with reference to a number of supporting decisions, it is defined: “A relative term without technical meaning. It may be employed as meaning disqualification; inability; incapacity; lack of ability, legal qualifications, or fitness to discharge the required duty.” In Black’s Daw Dictionary, 3rd edition, page 945, and in 1 Bouv. Daw Dict., Rawle’s Third Revisión, p. 1528, it is defined as “Lack of ability or fitness to discharge the required duty.” * * * Webster’s New International Dictionary defines it as “want of physical, intellectual, or moral ability; insufficiency; inadequacy; specif., want of legal qualifications or fitness.” Dunk & Wagnall Standard Dictionary defines it as “General lack of capacity of fitness, or lack of the special qualities required for a particular purpose.” [6 A. 2d at 869-870; emphasis supplied]

Thus, “incapacity,” like “incompetency,” is directly related to fitness to teach, a factor recognized as relevant in Loba v. Newark Board of Education, supra, 23 N. J. at 385-388. See also, Board of Public Education School Dist. v. Beilan, 386 Pa. 82, 125 A. 2d 327 (Sup. Ct. 1956), aff’d sub. nom. Beilan v. Board of Education, School Dist. of Phila., 357 U. S. 399, 78 S. Ct. 1317, 2 L. Ed. 2d 1414 (1958). But fitness to teach is not based exclusively on a teacher’s classroom proficiency or the absence of misconduct. It depends upon a broad range of factors. Beilan v. Board of Education, School Dist. of Phila,, supra, 78 S. Ct. at 1322. One of those factors, we have no doubt, must be the teacher’s impact and effect upon his or her students, for as was said in Adler v. Board of Education of City of New York, 342 U.S. 485, 72 S. Ct. 380, 96 L. Ed. 517 (1952) :

* * * A teacher works in a sensitive area in a schoolroom. There he shapes the attitude of young minds toward the society in which they live. In this, the state has a vital concern. • That the school authorities have the right and the duty to screen the officials, teachers, and employees as to- their fitness to maintain the integrity of the schools as a part of ordered society, cannot be doubted. [342 U. S. at 493; 72 S. Ct. at 380]

A like concern has been voiced by our own courts. It has been held that an “inefficient and incapable principal may do great injury to both pupils and teachers.” Redcay v. State Board of Education, 130 N. J. L. 369, 370 (Sup. Ct. 1943). In another context, when dealing with the proper penalty to be imposed upon a teacher charged with unbecoming conduct, we enjoined the Commissioner to “take into consideration any harm or injurious effect which the teacher’s conduct may have had on the maintenance of discipline and the proper administration of the school system.” In re Fulcomer, 93 N. J. Super. 404, 422 (App Div. 1967). And in Kochman v. Keansburg Bd. of Ed., 124 N. J. Super. 203, 212 (Ch. Div. 1973), involving a section of the education law which required board of education employees to undergo physical ex-animations at least once a year, the court observed that the Legislature “is concerned with protecting school children from the influence of unfit teachers.”

A recent group of California cases has emphasized the importance of the question of fitness in the relationship between teacher and student, with particular reference to the impact the former makes on the latter.

In Morrison v. State Board of Education, 1 Cal. 3d 214, 82 Cal Rptr. 175, 461 P. 2d 375 (Sup. Ct. 1969), the issue was whether a teacher who had been involved in an isolated, noneriminal, homosexual relationship was subject to disciplinary action under a California statute authorizing revocation of a teacher’s life diploma for immoral conduct. The Supreme Court of that state concluded that the school board could not abstractly characterize the conduct in the case as “immoral,” “unprofessional” or “involving moral turpitude” unless that conduct indicated unfitness to teach. The court wont on to delineate standards by which unfitness to teach may he determined :

In determining whether the teacher’s conduct thus indicates unfitness to teach the board may consider such matters as the likelihood that the conduct may have adversely affected students or fellow teachers, the degree of such adversity anticipated, the proximity or remoteness in time of the conduct, the type of teaching certificate held by the party involved, the extenuating or aggravating circumstances, if any, surrounding the conduct, the praiseworthiness or blame-worthiness of the motives resulting in the conduct, * * * These factors are relevant to the extent that they assist the board in determining a teacher’s fitness to teach, i. e., in determining whether the teacher’s future classroom■ performance and, overall impact on his students are likely to meet the hoards’ standards. [82 Cal. Rptr. at 186-187, 461 P. 2d at 386-387; emphasis supplied]

The court concluded:

* * ** Thus an individual can be removed from the teaching profession only upon a showing that his retention in the profession poses a significant danger of harm to either students, school employees, or others who might be affected by his actions as a teach&r. * * * Id. at 191, 461 P. 2d at 391; emphasis supplied]

In Board of Trustees of Compton Jr. Col. Dist. v. Stubblefield, 16 Cal. App. 3d 820, 94 Cal. Rptr. 318, 321 (D. Ct. App. 1971), the court said:

* * * [T]he calling [of a teacher] is so intimate, its duties so delicate, the things in which a teacher might prove unworthy or would fail are so numerous that they are incapable of enumeration in any legislative enactment. * * * His habits, his speech, his good name, his cleanliness, the wisdom and propriety of his official utterances, his associations, all are involved. Sis ability to inspire children and to govern them, his power as a teacher, and the character for tohich he stands are matters of major concern in a teacher’s selection and retention. [94 Cal. Rptr. at 321; emphasis supplied.]

See also, Watson v. State Board of Education, 22 Cal. App. 3d 559, 99 Cal. Rptr. 468 (D. Ct. App. 1972); Comings v. State Board of Education, 23 Cal. App. 3d 94, 100 Cal. Rptr. 73 (D. Ct. App. 1972).

We think it would be wrong to measure a teacher’s fitness solely by his or her ability to perform the teaching function and to ignore the fact that the teacher’s presence in the classroom might, nevertheless, pose a danger of harm to the students for a reason not related to academic proficiency. We are convinced that where, ■ as has been found in this case, a teacher’s presence in the classroom would create a potential for psychological harm to the students, the teacher is unable properly to fulfill his or her role and his or her incapacity has been established within the purview of the statute. In fairness to Mrs. Grossman, we emphasize that the Commissioner’s conclusions relate only to her fitness to continue teaching in the Bernards Township school system. We express no opinion with respect to her fitness to teach elsewhere and under circumstances different from those revealed in the present case.

Ill

It is contended, further, that since the Commissioner raised the possibility of Mrs. Grossman’s being disabled within the meaning of the Teachers’ Pension Law, N. J. S. A. 18A :66-1 et seq., he should first have referred the matter to the board of trustees of the pension fund. The fear is voiced that the Commissioner’s decision to order Mrs. Gross-man’s dismissal and, at the same time, to direct the board to submit a disability retirement application in her behalf, presents an irreconcilable inconsistency. We do not agree.

The board of trustees of the pension fund and the Commissioner of Education constitute separate administrative agencies, each with a mutually exclusive area of expertise and authority. See Bd. of Trustees of Teachers’ Pension, etc. v. La Tronica, 81 N. J. Super. 461, 468 (App. Div. 1963), eertif. den. 41 N. J. 587 (1964). Moreover, the subject matters within each sphere of jurisdiction, i. e., dismissal and retirement, are distinct. Cf. Jacobs v. N. J. State Highway Authority, 54 N. J. 393, 397 (1969). Thus, in arriving at their respective administrative determinations, each agency might employ different factors bearing upon the claimed incapacity or disability of a teacher. Cf. Russo v. Teachers’ Pension and Annuity Fund, 62 N. J. 142, 146 (1973). For example, while the Commissioner deemed Mrs. Grossman unfit to teach in the Bernards Township school system within the context of dismissal, the board of trustees might consider, within the retirement context, whether she is incapable of teaching in any capacity in any school district. Moreover, the determination by the board of trustees might be based upon whether the teacher is, in fact, mentally or physically unfit to perform the required duties, and not upon whether the teacher is unfit to perform in the context of the teacher-student relationship.

IV

We perceive no merit in the argument that Mrs. Grossman’s “constitutional rights to equal protection of the laws have been violated by the application of standards resulting in her dismissal where the same standards are not applied to other teachers in the same school system.” It has not been demonstrated that the standard of unfitness based upon a teacher’s adverse emotional effect upon students would not be applied to other teachers if the facts warranted such result.

The contention that the board violated Mrs. Grossman’s rights to equal protection by not seeking a declaration of disability is specious.

Y

The last issue to be decided is whether Mrs. Grossman was entitled to back pay pursuant to L. 1971, c. 435, which became effective February 10, 1972, subsequent to her suspension but prior to the Commissioner’s decision on April 10, 1972. It will be recalled that the Commissioner held that she was and that the State Board of Education reached a contrary conclusion.

Mrs. Grossman was suspended without pay by the local board on August 19, 1971, pursuant to the authority granted by N. J. S. A. 18A :6-14, which at that time provided as follows:

Upon certification of any charge to the commissioner, the board may suspend the person against whom such charge is made, with or without pay, pending final determination of the same, and if the charge is dismissed, the person shall be reinstated immediately with full pay as of the time of such suspension.

The amendatory statute (L. 1971, c. 435) added a new section, designated as N. J. S. A. 18A :6-8.3, providing, in pertinent part, that:

Any employee or officer of a board of a board of education * * * who is suspended * * * pending any * * * hearing or trial or any appeal therefrom, shall receive his full pay or salary during such suspension, except that in the event of charges * *• * brought before the board of education or the Commissioner of Education pursuant to law, such suspension may be with or without pay or salary. * * *

It also amended N. J. S. A. 18A:6-14 by providing, to the extent pertinent here, that in ease the board, upon certification of any charge to the Commissioner, suspends the person against whom the charge is made:

* * * [I]f tlie determination of the charge is not made within 120 calendar days after certification of the charges * * * then the full salary (except for said 320 days) * * shall be paid * * * until such determination is made. * *' * Should the charge be dismissed and the suspension be continued during an appeal therefrom, then the full pay or salary of sucli person shall continue until the determination of the appeal. * * * Should the charge be sustained on the original hearing or an appeal therefrom, then the suspension may be continued unless and until such determination is reversed, in which event he shall be reinstated immediately with full pay as of the time of such suspension.

The question is whether, as Mrs. Grossman contends and the Commissioner decided, the amendatory statute is to be given retroactive effect, or whether, as is implicit in the reversal by the State Board of Education, it is applicable only to those suspended after its effective date.

Generally, statutes relating to substantive rights are construed to operate prospectively, in the absence of a clear expression of opposite intent, whereas statutes relating to procedure and remedy are applicable to pending proceedings where vested rights would not be disturbed or obligations of contracts impaired. Neel v. Ball, 6 N. J. 546, 551 (1951); 2 Sutherland, Statutory Construction (3 ed. 1943), § 2210 at 129-130. In our view, the amendment involved in this case, which has the effect of limiting the period of time during which a teacher (or other board employee) can be suspended without pay, is procedural and remedial, and not, as the board contends, substantive. The cases on which it relies, such as Nichols v. Jersey City Board of Education, 9 N. J. 241 (1952), and Kopczynski v. Camden County, 2 N. J. 419 (1949), are inapposite.

We see no sound reason for not applying the amendment to cases pending on its effective date. It seems clear that in enacting it the Legislature must have had in mind the economic hardship endured by teachers and other board of education employees suspended without pay pending the outcome of charges filed against them and certified for hearing to the Commissioner of Education. We are certain, moreover, of the Legislature’s awareness that in many instances, because of the volume of matters awaiting hearing, a prompt disposition of charges is not feasible. Thus, the obvious intent and purpose of the amendment was to alleviate the financial plight of those affected by providing for the payment of their full salary (less sums received from other employment during suspension) from the 121st day following the certification of charges until the determination thereof by the Commissioner, or in the case of an appeal by a board from a decision adverse to it, until the determination of the appeal.

Fo vested rights or contractual obligations would be jeopardized by a retroactive application of the amendment to cases such as the one now before us. Furthermore, “[t]here is sound authority * * * for the proposition that when a statute is ameliorative, as this one can be considered to be, it may be applied retroactively. People v. Oliver, 1 N. Y. 2d 152, 151 N. Y. S. 2d 367, 134 N. E. 2d 197 (Ct. App. 1956).” In re Smigelski, 30 N. J. 513, 527 (1959).

Permitting Mrs. Grossman to have her back pay to the extent permitted by the amendment would be fair and just and consistent with the clear objective of the law.

VI

That part of the decision of the State Board setting aside the Commissioner’s direction for payment of Mrs. Grossman’s back salary is reversed. The matter is remanded to the Commissioner for a determination of the amount of salary due Mrs. Grossman from the 121st day following the certification of charges to April 10, 1972, less any sums by way of pay or salary received by Mrs. Grossman from substituted employment assumed during her period of suspension.

In all other respects, the determination of the State Board is affirmed.


source: Caselaw Access Project

author: Michels, J. S. C.,

license: Public Domain

text:
    CARLTON MILLER AND JUDITH MILLER, PLAINTIFFS-RESPONDENTS, v. UNITED STATES FIDELITY AND GUARANTY COMPANY, DEFENDANT-RESPONDENT, AND CUMBERLAND MUTUAL FIRE INSURANCE COMPANY, DEFENDANT-APPELLANT.
    Superior Court of New Jersey Appellate Division
    Submitted November 5, 1973—
    Decided February 20, 1974.

      Before Judges Lynch, Mehler and Michels.

      Messrs. White, Simpson & Strout, attorneys for appellant (Mr. David J. Strout, of counsel).

      Messrs. Falciani, Stoinski & Lisa, attorneys for plaintiffs-respondents (Mr. Henry R. Stoinski, of counsel).

      Messrs. Martin & Crawshaw, attorneys for defendant-respondent (Mr. G. Paul Crawshaw, of counsel).
   The opinion of the court was delivered by

Michels, J. S. C.,

Temporarily Assigned. This appeal involves the construction of the clause of a liability policy of insur anee commonly referred to as a “homeowner’s policy,” which extends coverage to relatives of the named insured or his spouse if the relatives are residents of the named insured’s household. The court below, on a motion for summary judgment brought by plaintiffs, relying upon the two policies of insurance involved and depositions of the involved persons, held that the infant who started the fire which caused plaintiffs’ property damage was a resident of his mother’s household, not of his father’s household, and imposed liability on her insurance carrier, Cumberland Mutual Eire Insurance Company (Cumberland). Summary judgment thereupon was entered against Cumberland in favor of plaintiffs and the father’s insurance carrier, United States Fidelity & Guaranty Company (U.S.F.&G.). Cumberland appeals.

Plaintiffs originally instituted suit to recover damages to their barn which was caused by a fire set by the infant Daryl Lewis. The suit was instituted against Daryl, his natural mother, Phoebe Hackett, and his natural father, Albert Lewis. Subsequently his stepmother, Hilda Lewis, was joined as a defendant. Daryl was nine years old at the time of the fire. His parents were divorced, and each had remarried, setting up separate homes about one-half mile apart. Pursuant to a custody decree which was in effect at the time of the fire, Daryl’s natural mother retained custody of Daryl, and his natural father was granted visitation rights three out of four weekends. However, in spite of the terms of the custody decree, the undisputed evidence establishes that Daryl was picked up by his father each Saturday morning at his mother’s home, and taken to his father’s home where he slept each Saturday. Daryl was then returned to his mother’s home each Sunday. This arrangement between the mother and father was followed every weekend. Daryl lived with his mother during the week and lived with Ms father on weekends. In fact, in response to the question: “Who do you live with Daryl replied: “My dad and my mom.”

On the day of the fire Daryl’s father picked him and his brother np at nine o’clock in the morning and brought them to his home as was customary. One of Daryl’s chores at his father’s home was to burn 'the trash, which he did on that day. Thereafter he started a fire in plaintiffs’ barn which resulted in extensive damage, giving rise to the original suit brought against him and his natural parents and stepmother. Neither Cumberland, his mother’s insurance carrier, nor U. S. P. & G., his father’s insurance carrier, would provide a defense to that suit on behalf of Daryl. Consequently, Daryl was unrepresented until pretrial conference, when the court appointed a guardian ad litem to represent him. Thereafter, following completion of discovery, a consent judgment was entered in favor of plaintiffs and against the infant Daryl in the amount of $43,000. This action was then instituted by plaintiffs against Cumberland and TJ. S. P. & G. Plaintiffs contended that both policies provided coverage to Daryl for this incident.

The court below disagreed and held that only Cumberland’s policy provided Daryl with coverage. The court reasoned that Daryl could not live in two places: his domicile and residence were with his mother, not his father.

Each of the policies of insurance contained the following identical provisions:

2. DEFINITIONS:
(a) Insured: Tlie unqualified word “Insured” includes (1) the Named Insured and (2) if residents of his household, his spouse, the relatives of either, and any other person under the age of twenty-one in the care of an Insured.

Cumberland contends that the court below erred in granting summary judgment because the question of whether Daryl was a resident within the meaning of the clause under review was one of fact for a jury. We disagree. A motion for summary judgment will be granted where the pleadings and depositions do not show the existence of a genuine issue of material fact requiring disposition at trial. See Judson v. Peoples Bank & Trust Co. of Westfield, 17 N. J. 67, 74 (1954); Sokolay v. Edlin, 65 N. J. Super. 112, 120 (App. Div. 1961); Eisen v. Kostakos, 116 N. J. Super. 358, 370 (App. Div. 1971) ; R. 4:46-2. The pertinent facts involved in this appeal are not in dispute. They were fully developed through depositions and stand uncontroverted. The court is not precluded from adjudicating the legal consequences to be drawn from undisputed facts. Cf. United States v. General Instrument Corp., 87 F. Supp. 157, 165 (D. N. J. 1949); Fox v. Johnson & Wimsatt, 75 U. S. App. D. C. 211, 127 F. 2d 729, 737 (1942). Summary judgment was therefore appropriate for the determination of the coverage issue here involved.

Cumberland further contends that the court below erred in equating the terms “domicile” and “residence,” and thus holding that Daryl was a resident solely of his natural mother’s household. Cumberland argues that in view of the evidence, Daryl was either solely a resident of the household of his father and therefore covered by the U. S. E. & G. policy, or, at the least, a resident of both households and therefore entitled to protection under both policies. Plaintiffs join with Cumberland in this contention, seeking the protection of the larger U. S. F. & G. policy and, alternatively, both policies.

The policies of insurance here involved extended coverage to relatives of the named insured and his spouse “if residents of his household.” The terms contained in the clause under review do not have any absolute meaning. Their meaning may vary according to the circumstances in each case. Consequently, in construing the language “residents of his household,” we do so in light of the well established principles set forth in Mazzilli v. Acc. & Cas. Ins. Co. of Winterthur, 35 N. J. 1, 7 (1961). In Mazzilli our Supreme Court stated:

Household is not a word of art. Its meaning is not confined within certain commonly known and universally accepted limits. True, it is frequently used to designate persons related by marriage or blood, who dwell together as a family under a single roof. * * But it has been said also that members of a family need not in all eases reside under a common roof in order to be deemed a part of the household, [at 8]

See also, Crossfield v. Phoenix Ins. Co., 77 N. J. Super. 476, 479 (App. Div. 1962).

A “resident” is generally defined as “One who has his residence in a place.” Black’s Law Dictionary (4th ed 1951), 1473; 2 Bouvier’s Law Dictionary and Concise Encyclopedia (3rd rev. 1914), 2920. Our courts have recognized the difference between the meaning of the words “residence” and “domicile,” and have held that they are not convertible terms. State v. Garford Trucking, Inc., 4 N. J. 346, 353 (1950). In State v. Benny, 20 N. J. 238 (1955), the Supreme Court defined these terms and pointed out the underlying difference as follows:

Domicile has been variously defined as the place where a person “has his true, fixed, permanent home, and principal establishment, and to which, whenever he is absent, he has the intention of returning,” Story, Conflict of Laws (8th ed.), § 41, p. 40, or “the habitation fixed in any place, without any present intention of removing therefrom,” 4 * *.
^ # v »Jt s¡t :]?
Residence, on the other hand, though parallel in many respects to domicile, is something quite different in that the elements of permanency, continuity and kinship with the physical, cultural, social and political attributes which inhere in a “home” according to our accepted understanding, are missing. Intention adequately manifested is the catalyst which converts a residence from a mere place in which a person lives to a domicile. Where a person has two homes in which he lives and between which he divides his time, it is still his intention which creates one or the other as his domicile. 1 Beale, Conflict of Laws, § 10.3 ■—• not the same intention necessary to create a domicile out of a mere residence but such additional intention manifested by a desire to exercise at one of the places the rights growing out of a true domicile and to become subject to the accompanying obligations, [at 250-251]

While a person may have only one true domicile, he may have more than one residence. State v. Garford Trucking, Inc., supra; Mercadante v. Paterson, 111 N. J. Super. 35, 39 (Ch. Div. 1970), aff’d 58 N. J. 112 (1971); Continos v. Parsekian, 68 N. J. Super. 54, 58 (App. Div. 1961). In fact, he may be a resident of more than one household for purposes of insurance. See Travelers Ins. Co. v. Mixon, 118 Ga. App. 31, 162 S. E. 2d 830, 831 (Ct. App. 1968); State Farm Mutual Automobile Ins. Co. v. Holloway, 423 F. 2d 1281, 1283 (10 Cir. 1970). Consequently, Daryl could be a resident of two separate households for purposes of insurance coverage. The finding by the court below that Daryl was a resident of his mother’s household does not preclude a finding that he was also a resident of his father’s household as a matter of law.

U. S. F. & G. argues to the contrary, contending that the controlling factor in the determination of which household Daryl was a resident is the custody decree which gave custody to his mother and mere visitation rights to his father. We disagree. In Cal-Farm Ins. Co. v. Boisseranc, 151 Cal. App. 2d 775, 312 P. 2d 401 (D. Ct. App. 1957), a similar argument was raised and rejected by the court. There, the insurance carrier brought suit seeking a declaration that James Boisseranc, the infant son of August, was not covered under the terms of a comprehensive liability policy issued to August which protected August and his wife Carolyn and relatives "if residents of his household.” When the policy was purchased, the family was intact. Thereafter, August and Carolyn separated, and two of the children, including James, went to live with their mother Carolyn. Subsequently, Carolyn obtained an interlocutory divorce decree, and pursuant to a modification thereof prior to the accident both parents were awarded joint custody of James with the provision that Ms "physical residence” would be with Ms mother Carolyn, and that his father August would have the right of visitation at all reasonable times, including visitation by James at Ms father’s home. The evidence showed that James spent substantially three-fourths of his time with his father. On the day of the accident, shortly after leaving Ms father’s home and while staying with his mother, James injured another child who brought the suit from which the insurance carrier sought to be relieved. The California District Court of Appeals 'held that the infant was a “resident” of his father’s “household” and affirmed the judgment below decreeing that the infant was an insured within the meaning of the policy. The court in reaching this result expressly rejected the argument that the custody decree controlled the question of residence as a matter of law stating:

* * * It is certainly obvious that the terms of the custody decree are not controlling as a matter of law. Certainly, even if such decree had given full custody and control of James to Carolyn, without even a right of visitation in August, and had James spent all of his time on his father’s farm, James would be an “insured” within the meaning of the policy. One purpose of the extension of coverage clause is to broaden the coverage of the named insured. August, when he took out the policy, was potentially liable for the torts of his minor children under proper circumstances. Thus, the extension of coverage to “relatives” protects August, the named insured, as well as protecting the relatives. Another purpose of the extended coverage provision was to assist the insured, August, in complying with his moral and legal obligation to maintain and support his family. It is of some significance that the policy does not contain any itemization of the persons covered, specifying only the named insured, August and his partner, and the insured premises. The premium payments were not based upon the number of relatives living on the premises. [312 P. 2d at 405]

Here, the undisputed evidence established that Daryl was in fact a resident of two households. He resided with his natural mother during the week from Monday to Friday, and with his natural father on weekends from Saturday to Sunday. A substantially integrated family relationship existed between Daryl and his mother on the one hand, and Daryl and his father on the other during the time that he lived with each one. Daryl’s intention to be a part of each household is clearly manifested by his response to the question “Who do you live with?” — “My dad and my mom.”

Accordingly, we are of the opinion that in the light of the well settled rules of construction of policies of insurance, and in view of the nncontroverted facts here involved, Daryl was a resident of both his natural mother’s and his natural father’s households, and, therefore, an insured within the meaning of the policies of insurance issued to each. Accordingly, we hold that both Cumberland and U. S. F. & G. furnished coverage to Daryl for the property damage involved and reverse the judgment below to the extent that it was granted in favor of U. S. F. & G. Judgment will therefore be entered in favor of plaintiffs and against both Cumberland and U. S. F. & G.


author: Meanor, J. A. D.

text:
    JACK VALE, APPELLANT, v. GAYLORDS NATIONAL CORPORATION AND BOARD OF REVIEW, DEPARTMENT OE LABOR AND INDUSTRY, STATE OF NEW JERSEY, RESPONDENTS.
    Superior Court of New Jersey Appellate Division
    Submitted February 4, 1974—
    Decided February 22, 1974.

      Before Judges Handler, Meanor and Kole.

      Messrs. Weintraub and Gelade, attorneys for appellant (Mr. Michael J. Weintraub on the brief).
    Statement in lieu of brief submitted on behalf of respondent Gaylords National Corporation.

      Mr. William F. Hyland, Attorney General of New Jersey, attorney for respondent Board of Review, Department of Labor and Industry, State of New Jersey (Mr. George F. Kugler, Jr., former Attorney General of New Jersey, and Mr. Stephen Skillman, First Assistant Attorney General, of counsel, and Mr. Michael S. Bokar, Deputy Attorney General, on the brief).
   The opinion of the court was delivered by

Meanor, J. A. D.

Vale applied for New Jersey unemployment compensation, was turned down, and has appealed through the administrative route to this court. After his initial denial by New Jersey, he applied for and was refused benefits in Ohio and did not seek appellate relief in that state.

The applicable statute is N. J. S. A. 43 :21-19. The question is whether Vale’s job activities constituted “employment” under certain sections of that statute defining covered employment. It should be noted that with respect to the statutory sections involved here, pertaining as they do to interstate employment, uniform definitions are used throughout the nation on the theory that only one state shall become liable for unemployment compensation benefits, and to insure such liability in an appropriate jurisdiction to one entitled to benefits. See Claim of Mallia, 299 N. Y. 232, 86 N. E. 2d 577, 9 A. L. R. 2d 636 (Ct. App. 1949), aff’g In re Mallia, 273 App. Div. 391, 77 N. Y. S. 2d 739 (App. Div. 1948), and Eagle Truck Transport, Inc. v. Board of Review, etc., 29 N. J. 280, 284-285 (1959). The provisions of N. J. S. A. 43:21-19 pertinent here are:

’hífcífcíiíSfcíítlS'SlC
(1)
^ si? sp» sfc #
(2) The term “employment” shall include an individual’s entire service performed within or both within and without this State if:
(A) The service is localized in this State; or
(B) The service is not localized in any state but some of the service is performed in this State, and (i) the base of operations, or, if there is no base of operations, then the place from which such service is directed or controlled, is in this State; or (ii) the base of operations or place from which such service is directed or controlled is not in any state in which some part of the service is performed, but the individual’s residence is in this State.
i'r * *S* sK* * ❖ *
(5) Service shall be deemed to be localized within a state if
(A) the service is performed entirely within such state; or
(B) the service is performed both within and without such state, but the service performed without such state is incidental to the individual’s service within the state, for example, is temporary or transitory in nature or consists of isolated transactions.

It is obvious that these tests are to be applied successively to the end that eligibility can be denied only if the claimant satisfies none of them. Claim of Mallia, supra, 86 N. E. 2d at 580.

The Appeal Tribunal found that Vale’s employment was localized in Ohio, and the Board of Review affirmed on this basis. Here, the Board concedes, and we agree, that this finding is not supported by the record. The extent of Vale’s activities in Ohio, where he spent only 10-15% of his time in a job that required virtually constant interstate travel, prevents, in light of the statutory definition, any rational conclusion that his employment was localized in Ohio. Vale spent more of his occupational time in Ohio than in any other state and it is therefore obvious that his employment was not localized in any state.

Since the “localization” test is inapplicable, it must next be determined if Vale had a base of operations in any state. There can be only one base of operations. Claim of Mallia, supra. The only state in which Vale might have had a base of operations is Ohio. This is the argument now advanced by the Board. We are invited to make our own findings on this issue and affirm. We decline the invitation because the record before us is not suitable for that purpose.

The phrase “base of operations” surprisingly has received little judicial construction. There is a working definition quoted but not adopted in Heller v. International Transport, Inc., 94 Idaho 91, 481 P. 2d 602, 604 (Sup. Ct. 1971) as follows:

* * * yle “place of a more or less permanent nature from which the claimant commences his work and to which he customarily returns in order to receive instructions and communications.”

Many of the available cases are collected in Annotation, “Unemployment compensation benefits and incidence of tax upon employer where, during the base year, employee worked in different states for same employer,” 9 A. L. R. 2d 646 (1950).

We do not believe the definition quoted above is all inclusive, but think it can be used as a guide. Obviously, the ramifications of what constitutes a base of operations will vary with the circumstances of each employment.

Vale did say that his headquarters was in Ohio, and basically on this slim reed we are asked to conclude that his base of operations was there. Beyond this statement there is virtually nothing in the record on this issue and therefore we remand for a rehearing. Among the relevant circumstances that can be explored are the place of receipt of his paycheck; the business address he had on his business cards, if any; where his business mail was addressed; where he received his telephone orders from New Jersey; where he prepared any business correspondence, including expense vouchers.

If Yale had a base of operations in Ohio, then he is ineligible for New Jersey benefits. If he did not, then he would be eligbile for such benefits if he can satisfy the succeeding test which is applicable only where there is no base of operations. This latter test would be satisfied if (1) Yale performed some of his service in New Jersey, and (2) his service was controlled and directed from New Jersey.

If Yale did not have a base of operations, then we are satisfied that the record before us requires the conclusion that he satisfied the criteria for eligibility we have set forth immediately above since he performed some service in and received his orders from New Jersey. On this analysis there is no need to consider the last test of eligibility which has been referred to as the “resident” test. In re Mallia, supra, 77 N. Y. S. 2d at 744.

Accordingly, the judgment of the Board of Eeview is reversed and the matter remanded for rehearing and determination of the issue whether Yale had a base of operations in Ohio. If he did, then he is ineligible for New Jersey benefits. If he did not, then he is eligible.

Eeversed and remanded. We do not retain jurisdiction.


author: Allcorn, J. A. D.

text:
    THEODORE A. LOBSENZ, PLAINTIFF-RESPONDENT, v. MICUCCI HOLDINGS, INC., A NEW JERSEY CORPORATION, DEFENDANT, SIC & DUE, INC., A NEW JERSEY CORPORATION, APPELLANT.
    Superior Court of New Jersey Appellate Division
    Submitted January 28, 1974—
    Decided March 4, 1974.

      Before Judges Leonard, Allcorn and Crahay.

      Messrs. Kimmel & Cavaliere, attorneys for the appellant.

      Mr. Theodore A. Lobsenz, respondent, pro se.

   The opinion of the court was delivered by

Allcorn, J. A. D.

Since the decision in Hardyston Nat. Bank v. Tartamella, 56 N. J. 508 (1970), it has been settled in this State that an owner-mortgagor has a right to redeem the mortgaged property following foreclosure and sale thereunder, by the payment in full of the mortgage indebtedness, costs of foreclosure and costs of sale. Under Hardyston the right must be exercised “within the ten-day period fixed by B. 4:65-5 for objections to the sale and until an order confirming the sale of objections are filed under the rule.” Id. at 513.

This Tight of redemption confirmed in Hardyston is not fashioned by nor dependent upon statute; instead, it is a right created and “devised by equity to protect him [the mortgagor] from the forfeiture of his title.” Ibid.; compare N. J. S. A. 2A:50-4. It is thus closely comparable to the owner-mortgagor’s equity of redemption and much like an extension of it. But, whatever its precise nature and however characterized, the right of redemption obviously is a valuable right and, as such, is subject to transfer and conveyance just as is any other right, title or interest in or to real property. See Ghee v. Davenport, 4 N. J. Super. 518 (App. Div. 1949), aff’g 2 N. J. Super. 532 (Ch. Div. 1949); compare 2 Glenn on Mortgages, §238 (1943).

Given the existence of the right to redeem in the owner-mortgagor and the transferability of that right by the latter to a third person in exchange for a consideration, the fairness and adequacy of which is not challenged, the trial court here declined to permit the transferee to exercise the right to redeem, on the ground that to do so would offend a public interest. It would, it was said, “seriously impede the judicial process in mortgage foreclosures and lend aid to disruption of orderly mortgage foreclosure sale procedures by speculators in mortgagor’s rights,” much like the intrusion and interference by speculators condemned in Bron v. Weintraub, 42 N. J. 87 (1964). In our view the analogy is not well-taken, and we perceive no valid public interests or considerations of policy that would be adversely affected by the exercise of the right to redeem by a transferee of the owner-mortgagor.

In the present case the owner-mortgagor has transferred and assigned his right to redeem (as well as his right and interest to the building heating system) for a consideration of $5,000 —- the payment thereof being made contingent upon the transferee being permitted to exercise the right of redemption. If the transferee is permitted to redeem, the mortgagee is rendered whole and the owner-mortgagor is benefited. Thus, the mortgagee would receive the full amount of the mortgage indebtedness, including interest, plus his costs and expenses in the foreclosure proceedings and on the sheriff’s sale. The owner-mortgagor, in turn, would receive the sum of $5,000, and the deficiency amounting to some $55,000 would be completely eliminated. At the same time, the transferee would have title to the premises, unencumbered by the mortgage, for which he will have paid a sum in excess of $60,000. '

If, on the other hand, the proposed redemption is barred and, as a result, fails of consummation, the owner-mortgagor is deprived of the $5,000 consideration for his redemptive right, and the $55,000 deficiency remains unsatisfied — for the whole of which the owner-mortgagor remains personally liable, without credit for fair market value under N. J. S. A. 2A :50-3, this being a note mortgage rather than a bond mortgage. 79-83 Thirteenth Ave., Ltd. v. De Marco, 44 N. J. 525 (1965). At the same time, the mortgagee would receive a windfall which, by his own reckoning, amounts to more than $2,500. Eor, he will then have the property which, he asserts in his brief, "the only recent independent appraisal of the property * * * just completed by * * * Garfield” under its program of "revaluation to 100% assessment”, resulted in an assessed value of $58,000 for the year 1973. Having bought in the property at the foreclosure sale for the sum of $100, and the deficiency remaining being of the amount of $55,230.02, the mortgagee will thus have acquired the property, which he himself suggests to be of a value of $58,000, for the total sum of $55,330.02 — and he will still retain the right to proceed against the owner-mortgagor on the $55,000-plus deficiency.

We are unaware of any policy or other considerations that would justify thus disfavoring an owner-mortgagor and, simultaneously, favoring the mortgagee to his enrichment. Nor are we cognizant of any public or other interests which would disqualify, as an intermeddler seeking to gain an improper and unfair advantage, a transferee of the right of redemption committed to the payment of a sum in excess of $60,000 for a property valued by the mortgagee at $58,000.

It is very much to be doubted that bidding at foreclosure sales would be any more discouraged by allowing a transferee to exercise the right to redeem the property, than it is by permitting redemption by the owner-mortgagor — if, in fact, the right of the latter has any such effect whatever. We perceive none, and our attention has been directed to none. Indeed, in those states in which the right to redeem is created by statute, redemption “by the mortgagor or his successor is a universal feature of [said] statutes.” Osborne on Mortgages (2nd ed. 1970), §309.

At all events, a foreclosing mortgagee who has been or will be made whole has no basis or standing to complain. It has been well said that “a mortgagee is not entitled to recover more than the full amount of the mortgage debt.” 79-83 Thirteenth Ave., Ltd. v. De Marco, supra, 44 N. J. at 534. Similarly, there is no harm to any junior encumbrancers or lienors. And, quite obviously, there is no harm to the owner-mortgagor since he is free to bargain for a fair and adequate consideration for his right to redeem, whether or not the foreclosure sale results in surplus monies.

Finally, to permit a transferee of the owner-mortgagor to exercise the right of redemption would not unfairly deprive the successful bidder at the foreclosure sale (including the mortgagee) of the benefit of his bargain to any greater extent than when the owner-mortgagor himself redeems. The purchaser at the foreclosure sale bids and buys with 'actual or implied knowledge of the existence of the right to redeem, and with full awareness that his purchase is subject to being defeated by the timely exercise thereof. Hardyston Nat. Bank v. Tartamella, supra,.

Reversed.

      Although there appears to be no law on the issue in this State, it would appear that upon redemption by either the owner-mortgagor or his transferee, the whole of the foreclosure proceeding is nullified, in effect; and there can be little doubt that equity would thereupon restore and revive the respective interests of the junior encumbrancers and lienors in the property which, failing redemption, would have been cut off upon delivery of the sheriff’s deed following the foreclosure sale. Were it to be otherwise, an owner-mortgagor could cut off all existing junior liens by the simple device of inviting foreclosure and allowing the suit to proceed to judgment and sale, and then exercising his right of redemption.
      Blost of the discussions and cases with regard to the question in other jurisdictions deal with the right of redemption as created by statute, and turn on the construction of the respective statutory enactments. See Call v. Jeremiah, 246 Or. 568, 425 P. 2d 502, 506 (Sup. Ct. 1967) (dissenting opinion) ; Osborne on Mortgages (2nd ed. 1970), § 309; 2 Jones on Mortgages (8th ed. 1928), §§ 1347 et seq.; 55 Am. Jur. 2d, Mortgages, §§ 864 et seq. and § 1218; Annotation, “Effect on subordinate lien of redemption by owner or his grantee from sale under prior lien,” 5 A. L. R. 145 (1920).


text:
    STATE OF NEW JERSEY, PLAINTIFF-RESPONDENT, v. RAYMOND DAVIS AND ERNEST PACE, DEFENDANTS-APPELLANTS.
    Superior Court of New Jersey Appellate Division
    Submitted October 24, 1973—
    Decided February 20, 1974.

      Before Judges Handler, Meanor and Kole.

      Mr. Stanley C. Van Ness, Public Defender, attorney for appellants (Mr. Edward Weisslitz, First Assistant Deputy Public Defender, of counsel and on the brief).

      Mr. George F. Kugler, Jr., Attorney General, attorney for respondent (Mr. Robert J. Genatt, Deputy Attorney General, of counsel, and Messrs. Willard E. Byer, Jr. and Alfred J. Luciani, Deputy Attorneys General, on the brief).
   The opinion of the court was delivered by

Meanor, J. A. D.

These defendants appeal their convictions for armed robbery. The offense took place October 4, 1968 at the home of Joseph Celona, Pleasantville, Yew Jersey. At the time Celona was at the dining room table counting the day’s receipts from his retail store. In the living room of the home were Mrs. Mary Heckroth, who is Celona’s sister, and their elderly parents. When Celona answered a knock on the door, defendants entered, announcing “This is a stick up.” Defendant Ernest Pace had a shotgun and defendant Raymond Davis brandished a pistol. The thieves took $1,200 to $1,500 in cash and checks.

I

Both defendants offered an alibi. Pace did not testify but produced three witnesses who claimed that he was in Chicago at the time of the offense. His aunt, Mary Ann Williams, testified that on October 1 Pace left for Chicago in her car to obtain some personal papers she had left there. He returned October 8. Mrs. Evelyn Barber, Pace’s fiancee, said that she, Wanda Williams and another young woman had accompanied Pace to Chicago, leaving New Jersey October 1 and returning about October 8. Miss Williams, Pace’s cousin, also corroborated the alibi. The other participant in the trip did not testify because, it was said, she remained in Chicago. Obviously, the jury did not believe the alibi.

To rebut the alibi the State called William Harris. He testified that he had a conversation with Pace on November 14, 1968, during which Pace claimed that he was in Camden on October 4 and in Newark after that, returning to Atlantic City on October 11. Neither Harris’ occupation nor his reason for the conversation with Pace was brought out on direct. Harris was in fact Pace’s parole officer, and Pace was on parole at the time of the Celona robbery.

Disregarding his attorney’s advice, Pace had it brought out on cross-examination that Harris was a parole officer, that Pace was on parole on October 4, and that his departure from the State without permission would have been a violation of parole. It was also established that the interview by Harris took place while Pace was confined in the Atlantic County Jail. Proper objection was made to Harris’ testimony on the ground that its admission violated Miranda v. Arizona, 384 U. S. 436, 86 S. Ct. 1602, 16 L. Ed. 2d 694 (1966).

Miranda bars from evidence statements taken by law enforcement officers as a result of custodial interrogations unless prior thereto the accused has been advised of a well-known litany of rights and has knowingly and voluntarily waived them. State v. Hampton, 61 N. J. 250, 265 (1972); Mathis v. United States, 391 U. S. 1, 88 S. Ct. 1503, 20 L. Ed. 2d 381 (1968).

We need not decide whether the interrogation by Harris, directed solely to Pace’s parole and not part of an ongoing investigation of a subsequent crime, required the Miranda warnings. We hold that the exclusionary rule of Miranda does not reach the State’s presentation of Harris’ testimony in rebuttal.

That Miranda does not bar all use of voluntary in-custody statements taken by law enforcement officers in the absence of the required warnings and a waiver thereof was made clear in Harris v. New York, 401 U. S. 222, 91 S. Ct. 643, 28 L. Ed. 2d 1 (1971). Here, as in Harris, no question has been raised concerning the voluntariness of the statements involved. Harris held that a defendant’s non-Miranda statement, while not available during the State’s case in chief, could be used to affect the defendant’s credibility. The Harris rationale of permitting the impeachment use of evidence not available to the State on its main case is not a new one. Annotation, “Impeachment of accused as witness by use of involuntary or not properly qualified confession,” 89 A. L. R. 2d 478 (1963). Harris was anticipated by this court in State v. Kimbrough, 109 N. J. Super. 57, 65-68 (App. Div. 1970). See also, State v. Slobodian, 120 N. J. Super. 68 (App. Div. 1972), certif. den. 62 N. J. 77 (1972).

It is true that Harris arose in a context where the non -Miranda statement was used in cross-examination followed by an instruction that the statement could only be considered by the jury in assessing the defendant’s credibility and not as evidence of guilt. We do not read Harris, however, as elevating such a limiting instruction to the level of a constitutional command. During the course of its opinion the court said:

Assuming that the exclusionary rule has a deterrent effect on proscribed police conduct, sufficient deterrence flows when the evidence in Question is made unavailable to the prosecution in its case in chief. [401 U. S. at 225, 91 S. Ct. at 645.]

and further:

The shield proyided by Miranda cannot be perverted into a license to use perjury by way of a defense, free from the risk of confrontation with prior inconsistent utterances. [401 U. S. at 226, 91 S. Ct. at 616.]

We think it clear that if Miranda cannot be converted .into a license to commit perjury, it cannot also exist as a license to suborn it. In light of Harris there is no just reason to frustrate truth in the criminal process by forcing the State to withhold from legitimate rebuttal a voluntary statement of the accused otherwise inadmissible solely because it was taken in violation of Miranda. The testimony of Harris was properly admitted in rebuttal as an admission of defendant Pace.

We are not implying that the door is now open to the acceptance in rebuttal of non-Miranda statements as substantive proof in virtually every case where defense evidence is offered. We stress that such statements can only be received as legitimate rebuttal. Thus, the essential prelude to admissibility is that the conflict between defense proofs and the non-Miranda statement must be in sharp focus.

[The court here considered other points raised by defendant and found them without merit.]

       The State offers an alternate hypothesis to sustain admission of Harris’ evidence which we note but do not pass on. The thesis is that because of the special relationship between a parolee and his parole officer, interrogations by the latter are outside Miranda. The cases agree that a parole officer may testify in a parole revocation hearing concerning admissions secured from the parolee by an interrogation not preceded by Miranda warnings even where that interrogation took place in a custodial setting. People v. W., 24 N. Y. 2d 732, 302 N. Y. S. 2d 260, 249 N. E. 2d 882 (Ct. App. 1969) ; Clark v. State, 222 So. 2d 766 (Fla. D. Ct. App. 1969) ; State v. Jackson, 16 Ariz. App. 476, 494 P. 2d 376 (Ct. App. 1972). Courts have split upon the issue of whether the results of a parole officer’s questioning, aimed solely at the parole function and not preceded by Miranda warnings, may be admitted in a prosecution for a new offense. Answering in the negative is State v. Lekas, 201 Kan. 579, 442 P. 2d 11 (Sup. Ct. 1968), while Nettles v. State, 248 So. 2d 259 (Fla. D. Ct. App. 1971) takes the opposite view. Compare, however, Mathis v. United States, supra, and see also State v. Barnes, 54 N. J. 1 (1969), cert. den. 396 U. S. 1029, 90 S. Ct. 580, 24 L. Ed. 2d 525 (1970). It might also be noted that where the pax-ole relationship was perverted by using it as a subterfuge for an investigation into a subsequent offense, the results of that endeavor were held inadmissible. People v. Way, 65 N. Y. Misc. 2d 865, 319 N. Y. S. 2d 16 (Cty. Ct. 1971).

      Cf. State v. Burt, 107 N. J. Super. 390 (App. Div. 1969), aff’d o. b. 59 N. J. 156 (1971), cert. den. 404 U. S. 1047, 92 S. Ct. 728, 30 L. Ed. 2d 735 (1972), writ of habeas corpus granted sub. nom. United States ex rel. Burt v. Yeager, 342 F. Supp. 188 (D. N. J. (1972), rev’d sub. nom. United States ex rel. Burt v. State of New Jersey, 475 F. 2d 234 (3 Cir. 1973), cert. den. sub. nom. Burt v. New Jersey, 414 U. S. 938, 94 S. Ct. 243, 38 L. Ed. 2d 165 (1973). Compare State v. Griffin, 120 N. J. Super. 13 (App. Div. 1972), certif. den. 62 N. J. 73 (1972).


author: Per Curiam. Kolovsky, J. A. D.

text:
    SHELL OIL COMPANY, PLAINTIFF-RESPONDENT, v. ZONING BOARD OF ADJUSTMENT OF THE BOROUGH OF SHREWSBURY, DEFENDANT-APPELLANT.
    Superior Court of New Jersey Appellate Division
    Argued February 21, 1973—
    Decided March 21, 1973.

      Before Judges Kolovsky, Matthews and Crahay.

      Mr. Robert H. Otten argued the cause for the appellant (Messrs. Crowell & Otten, attorneys; Mr. David W. Clark on the brief.)

      Mr. Lawrence A. Carton, III argued the cause for the respondent (Messrs. Pillsbury, Barnacle, Russell & Carton, attorneys; Mr. John G. Colannino on the brief.)
   Per Curiam.

The judgment, ordering the Board of Adjustment to recommend variances for gas station use, is affirmed essentially for the reasons expressed in Judge Lane’s opinion in the Law Division.

The trial court recognized the presumption of correctness, fairness and proper motivation that a decision of the Board of Adjustment carries and of its limited scope of judicial review. Also acknowledged was that a Board’s acceptance or rejection of the testimony of witnesses, where such choice was reasonable, was conclusive on appeal.

On the basis of plaintiff’s proofs Judge Lane specifically found reasons for the grant of a (d) variance and rejected the Board’s specifications in denying the application.

The Board has found;

“. . . that the relief requested by the applicant cannot be granted without substantial detriment to the public good and without substantially impairing the intent and purpose of the zone plan and zoning ordinance of the Borough of Shrewsbury;
1. The proposed use would cause additional congestion at an already congested intersection;
2. There is no way to prevent traffic from crossing the highway and creating additional risks to the motorists at the intersection ;
3. The land in question could be put to a better and higher use;
4. Additional gas stations are not needed in the Borough of Shrews-bury and would not benefit the residents of the Borough of Shrews-bury.
5. The area involved is adjacent to an area which is composed of a large tract of land which is undeveloped;
6. The proposed use could have a deleterious effect on the future development of the surrounding undeveloped land;
7. No hardship has been shown by the applicant;
8. There are three Shell gas stations within a short distance of the residents of the Borough of Shrewsbury;
9. Gasoline stations are not a permitted use in the Borough of Shrewsbury;
10. The use sought is not particularly fitted to the location for which the variance is sought and special reasons do not exist for the granting of the variance . . .”

The findings of a Board of Adjustment must be substantially grounded in sufficient competent evidence. Izenberg v. Board of Adjustment of City of Paterson, 35 N. J. Super. 583, 588 (App. Div. 1955); Dolan v. DeCapua, 16 N. J. 599, 610 (1954); Stolz v. Ellenstein, 7 N. J. 291, 295 (1951).

Here, we hold that the Board’s findings were at best conclusional and not fairly supported by the proofs submitted. Significantly, the Board did not specifically find plaintiff’s proofs incredible or unpersuasive.

Affirmed.

Kolovsky, J. A. D.

(dissenting). An applicant for a use variance under N. J. S. A. 40:55-39(d) has the burden of establishing (1) that “special reasons” exist for the variance and (2) that the variance “can be granted without substantial detriment to the public good and will not substantially impair the intent and purpose of the zone plan and zoning ordinance.”

In my opinion, the finding of the Board of Adjustment (Board) that “special reasons do not exist for the granting of the variance” sought by Shell Oil Company (Shell) was not arbitrary or unreasonable and indeed was mandated by the proofs before it. From my reading of the applicable authorities, I am satisfied that there was no warrant for the trial court’s order directing the Board to recommend to the Borough’s governing body that Shell be granted a variance to allow it to operate a gasoline service station — a use not permitted in the zone under the Borough’s zoning ordinance — on the 1.7 acre tract which Shell had obligated itself to purchase if it was able to obtain the variance.

Apposite is what this court said, in reversing a trial court judgment ordering a Board of Adjustment to recommend a variance, in Mahler v. Borough of Fair Lawn, 94 N. J. Super. 173 (App. Div. 1967), which was affirmed unanimously on the opinion below in 55 N. J. 1 (1969). In Mahler, supra, we noted (at 183) that in a situation such as is here presented,

The resolution * * of the appeal must center about two problems: (a) did special reasons exist here which could have justified the board in recommending a variance, and (b) was the denial in this case so unjustified on the law and the facts as to have called for the reversal and mandate for variance by the court?

The Mahler opinion, after discussing at length what may constitute a “permissible” basis for a “special reasons” variance under N. J. S. A. 40:55-39 (d) grounded upon the zoning criterion of the “promotion of the general welfare”, then continued at 185-186:

In any case, however, the conclusive consideration here is that, whether or not the hoard could properly have granted a variance recommendation in this situation, there is utterly no basis for a judicial conclusion that it acted arbitrarily, capriciously or unreasonably in exercising its discretionary ffttasi-judicial powers by denying such a recommendation. And that is the controlling criterion on judicial review, whether the board grants or denies a variance. Kramer v. Board of Adjustment, Sea Girt, supra, 45 N. J., at pp. 296-297.
Our cases recognize that there is an area of special discretion reposed in the local agencies within which, in many situations, either the grant or denial of a (d) variance would be judicially sustained. The board of adjustment weighs the facts and the zoning considerations, pro and con, and will be sustained if its decision comports with the statutory criteria and is founded in adequate evidence. See Rain or Shine Box Lunch Co. v. Newark Board of Adjustment, 53 N. J. Super. 252, 259 (App. Div. 1958) ; Yahnel v. Board of Adjustment, Jamesburg, supra, 79 N. J. Super., at p. 519.
Moreover, as we stated in Cummins v. Board of Adjustment, Leonia, 39 N. J. Super. 452, 460 (App. Div. 1956), the judicial philosophy of sympathetic approach to local zoning decisions (Ward v. Scott, 16 N. J. 16, 23 (1955) is “even more cogently applicable to a case where we review a denial of a variance than where we review a grant, for generally speaking more is to be feared from a breakdown of a zoning plan by ill-advised grants of variances than by refusals thereof,” citing Beirn v. Morris, 14 N. J. 529, 536 (1954). Cf. Wilson v. Borough of Mountainside, 42 N. J. 426, 443 (1964).

Shell’s 1.7 acre tract is in a B-2 business zone in which, under the zoning ordinance, premises may be used for the following purposes:

1. Shopping centers limited to such uses as retail shops and stores, personal service establishments, professional and business offices, banks and restaurants except lunch wagons, diners, roadstands or outdoor drive-in refreshment stands. In addition, such shopping centers may also contain those uses set forth in Paragraph 2 hereafter.
2. Grocery, meat market, bakery, drugs and pharamaeeutical store, package liquor store, stationery, tobacco and newspaper store, barber or beauty shops, shoe repair shops, dry cleaning pick-up shops, professoinal offices, banks and fiduciary institutions, department stores, hardware stores, auto part stores, apparel shops, any other retail shop not specifically hereinabove enumerated, such as jewelry, hat, leather goods, hand bag, books, gifts, music and similar retail enterprises.

While the ordinance requires a minimum lot area of 300,000 square feet in B-2 zones, the deficiency in lot area of the 1.7 acre tract is of no material significance. The owner of the tract would be entitled, under N. J. S. A. 40:55-39 (c), to a variance from the 300,000 square foot area requirement of the ordinance and to such other variances from the “bulk” provisions of the ordinance as may be necessary to enable it to use the 1.7 acre tract for one or more of the numerous uses permitted in a B-2 zone by the quoted provisions of the ordinance.

The trial court concluded that the “special reason” which entitled Shell to the use variance it sought was “undue hardship”. I find no warrant for such a conclusion in the record and, more significantly, no justification for holding that the Board acted arbitrarily in determining from the evidence before it that the asserted “hardship” had not been proven.

“Undue hardship” may of course constitute a “special reason” for a use variance. Andrews v. Ocean Twp. Board of Adjustment, 30 N. J. 245, 251 (1959). But undue hardship is not established by a showing that the proposed use would be more profitable to the owner than the permitted uses. “The extension by variance of land use zones is not to be measured by the dollar.” Schoelpple v. Woodbridge Twp., 60 N. J. Super. 146, 153 (App. Div. 1960); Jenpet Realty Co., Inc. v. Ardlin, Inc., 112 N. J. Super. 79, 85 (App. Div. 1970), cert. denied 57 N. J. 436 (1971); Kohl v. Mayor and Council of Fair Lawn, 50 N. J. 268 (1967). See also Bern v. Fair Lawn, 65 N. J. Super. 435 (App. Div. 1961), in which this court said at 450 :

Uertainly a property owner is not entitled to a variance merely to serve the most profitable or economical use of the property if other less profitable uses are still reasonably feasible.

Here the trial court said in reaching its conclusion that “undue hardship” existed:

There was sufficient competent evidence to show that it would not be reasonably feasible to use the lot for any of the permitted uses. Unless used for a gasoline station the evidence indicates that the lot will remain vacant.

As I have heretofore noted, however, the controlling question is not whether “there was sufficient competent evidence to show that it would not be reasonably feasible to use the lot for any of the permitted uses.” (Emphasis added) Rather it is whether the evidence was such that it was arbitrary and unreasonable for the Board to find otherwise.

In mj1' view, not only did the evidence presented not rise to that stature, it would not support a finding that other permitted uses were not reasonably feasible on the 1.7 acre tract. At most, the -testimony of Shell’s real estate expert, who noted that a shopping center was to be built on an adjoining tract, indicated that a gasoline station in the area was needed, that such use was the highest and best use to which the property could be put and would present fewer problems, traffic and otherwise, than would any of the uses permitted by the ordinance.

I would reverse.


author: Rizzi, A. J. S. C.

text:
    THEODORE HAMMOND, PLAINTIFF, v. BRUCE C. DOAN, DEFENDANT.
    Superior Court of New Jersey Law Division
    Decided February 11, 1974.

      Mr. Charles I. Tighe, III for plaintiff (Messrs. Toll, Friedman, Pinsky & Jones, attorneys).

      Mr. Charles A. Winkelried for defendant.
   Rizzi, A. J. S. C.

This is an auto negligence case in which defendant moves for an order requiring a pretrial hearing and disposition of his second separate defense which alleges that the statutory threshold requirements of the New Jersey Automobile Reparation Reform Act, N. J. S. A. 39:6A-1 et seq., (otherwise, No-Eault Law) have not been met by plaintiff and therefore defendant is immune from suit under the statute. Plaintiff urges that the defense is one that can be decided at pretrial only if the facts are undisputed and the issue is one of law such as to authorize summary judgment to be entered.

The primary issue is a procedural one: What procedure should be followed by the court in fixing liability and coverage within the meaning of the statute, when these factors are placed in issue prior to time of trial on the merits of the suit themselves? There are competing considerations which must be dealt with in determining a course of action, and the importance of these considerations must be examined in light of the legislative intent and spirit of the statute in order to determine a proper procedure for disposal of the issues at hand. Defendant wishes to expedite the trial of the issue of his statutory obligation or exemption, and requests a preliminary adjudication thereon. Plaintiff, however, would want any trial of the issues to be full and complete rather than splintered and bifurcated or trifurcated to a piecemeal conclusion. While defendant cites the elimination of congestion of civil calendars as a key element in his motion, his suggested alternative is to divide the issues to be tried by multiplying the trials — an approach which does not appear to result in any substantial decongestion of litigation snarls.

The problem is one which has not been specifically dealt with either by statute or case law. In New Jersey the question as to the timeliness of entertaining and deciding a preliminary dispute based on coverage has not been dealt with within the context of the new No-Fault Law. An examination of the no-fault laws drafted in 11 states shows that none of them has addressed itself to this specific problem. However, an analysis of certain elements of these legislative schemes provides some parallel glimpses of statutory techniques adopted in practical litigation of claims.

The Massachusetts plan, earliest of the no-fault legislative schemes was adopted and went into effect in January 1971. The only definitive decision on its validity was Pinnick v. Cleary, Mass., 271 N. E. 2d 592, 42 A. L. R. 3d 194, in which the constitutionality of the no-fault scheme was upheld on several fronts. However, Massachusetts has provided for recovery for pain and suffering only if certain circumstances are present. There is no specific test of the sufficiency of the complaint as to pain and suffering; it appears that it is sufficient if plaintiff merely alleges in his declaration the existence of one or more grounds for pain and suffering recovery. If, after a trial of the issue, he has failed to prove existence of the alleged ground, presumably the court would instruct the jury to return no verdict for pain and suffering. Acts of 1970, chapter 670, section 34M, Laws of Massachusetts. Thus, the Massachusetts legislature did not provide for a preliminary hearing of some kind in order to test the sufficiency of a plaintiff’s allegations of pain and suffering, but rather relegates the issue to the trial itself and appropriately deals with it at that stage.

In Connecticut the remedy of declaratory judgment is specifically provided for in order to determine the amount of basic reparations benefits as due and owing between the insurer and the insured. Where the insured notifies his own insurance company of a course of rehabilitative treatment which he is taking due to his accident, and the insurer does not accept responsibility promptly for its cost, plaintiff can move in court in an action to adjudicate his claim, which action shall be privileged, for a determination that the insurer is responsible for the cost of the rehabilitation program. A privileged action can also be brought by the insurer in response to such a claim by the insured. Public Act 273, section 19, Laws of Connecticut. In addition, section 19 provides for the availability of a declaratory judgment action by either party for relief under other provisions of the law; for example, to test the constitutionality of the no-fault statute, as was done in Pinnick v. Cleary, supra, and Grace v. Howlelt, 51 Ill. 2d 478, 283 N. E. 2d 474 (Sup. Ct. 1972), wherein the plan of Illinois was declared unconstitutional.

These two instances were the only specific statutory authority dealing with the problem of how the court should proceed when presented with a preliminary attack upon the very pleadings and their sufficiency. Massachusetts deals with an attack upon the alleged pain and suffering only at actual trial, and permits the issue to be aired fully only when the parties’ day in court has arrived. In Connecticut the device of declaratory judgment can be employed by parties to define their rights and liabilities where questions of paying for rehabilitation measures and other actions of the parties are concerned. The litigation of these questions has not revealed any patterns of judicial solution, since there is no record of appellate or trial court consideration of these precise points. It should be pointed out that almost all of the no-fault states, including New Jersey (N. J. S. A. 39 :6A-13), provide for extensive discovery measures to determine and clarify the status of all parties concerned and to position them for purposes of litigation and proper joinder of those parties within the purview of the statute. Although such discovery is extremely valuable, there is still nothing in the statutes addressed to the suggested procedures which courts should follow in determining the preliminary coverage questions where the availability of an action against a third party under the “no-fault” statute is in issue; these are cases where dispute exists notwithstanding the utilization of discovery techniques, and courts must accordingly fashion appropriate remedies in terms of the competing considerations of the parties, the mandate of the Legislature, and the promotion of judicial efficiency.

The possibility of seeking a declaratory judgment, N. J. S. A. 2A :16-50 et seq., to determine the status of the parties should be considered. N. J. S. A. 2A :16-53 specifically provides this remedy in cases where “rights, status or other legal relations are affected by a statute.” Declaratory judgment actions require that a justiciable controversy be present, Unsatisfied Claim and Judgment Fund Bd. v. Concord Ins. Co., 110 N. J. Super. 191 (Law Div. 1970), and that the parties thereto assert the present infringement of legal rights, Union Cty. Bd. of Chosen Freeholders v. Union County Park Comm’n,. 77 N. J. Super. 425 (Law Div. 1963), rev’d on other grounds 41 N. J. 333 (1964). In questions of coverage in insurance cases, the declaratory judgment is a device often used to determine the extent of such coverage, Travelers Ins. Co. v. Tymkow, 91 N. J. Super. 184 (App. Div. 1966); Hartford Accident and Indemnity Co. v. Selected Risks Indemnity Corp., 65 N. J. Super. 328 (App. Div. 1961); Unsatisfied Claim and Judgment Fund Bd. v. Concord Ins. Co., supra. However, this present matter is not an action to define coverage, or even to construe a statute, since there has been presented no challenge by either party to the proper interpretation of the statute. While the declaratory judgment remedy ought not be denied lightly where a justiciable controversy exists within the statute, Union Cty. Bd. of Chosen Freeholders, supra, it still remains a matter to be determined within the vested discretionary power of the trial judge. Vonins Inc. v. Raff, 101 N. J. Super. 172 (App. Div. 1968). While it is true under R. 4:42-3 that a declaratory judgment action is not precluded by the existence of an alternative form of relief, there is ordinarily no reason to involve its provisions where another adequate remedy is available. Rego Industries Inc. v. American Modern Metals Corp., 91 N. J. Super. 447 (App. Div. 1966). The purpose of the declaratory judgment is to provide a means for adjudicating rights in eases involving controversy that has not yet reached the state at which either party may seek a coercive remedy.

In this instance defendant asserts that his defense of immunity from suit should be given a speedy trial for an early determination of his rights. The availability of summary judgment under R. 4:46 is a more appropriate remedy than declaratory judgment, since there appears to be no real dispute as to the facts, but rather differences in interpretation of the law. A motion for summary judgment does not admit all well-pleaded facts and should be granted if the rest of the record, including depositions and interrogatories, demonstrates the absence of a material and genuine factual dispute, Rankin v. Sowinski, 119 N. J. Super. 393 (App. Div. 1972). Given the broad powers of statutory discovery under New Jersey’s No-Fault Law, N. J. S. A. 39 :6A-13, ample opportunity to determine whether there are differences as to material facts does exist.

A motion for summary judgment appears to be the most fair-minded and economical method for a preliminary adjudication of a claim of immunity under the statute. If, indeed, there is no basis for plaintiff’s claim against defendant, then justice is served by a prompt determination of the existence of such a claim, and by disposal of a misdirected suit at this early juncture. If, however, there is a dispute as to material facts involved, then defendant is entitled to his day in court when his turn is called, and is not entitled to the extra consideration of a plenary hearing on his separate defense prior to any full trial of the entire issue. At the trial all arguments can be permitted and the questions of applicable law can be put to the facts found by a jury.

If the jury returns such findings as to indicate that the threshold requirements have not been mot the court will enter judgment for defendant and plaintiff will be left to pursue his no-fault remedies.

Defendant’s motion for a separate trial of his defense of immunity is denied.