author: Yancey, J. C. C.

text:
    THE STATE OF NEW JERSEY, PLAINTIFF, v. HARRY C. BOWENS, DEFENDANT.
    Essex County Court Law Division — Criminal
    Decided May 16, 1968.

      Mr. Elmer J. Herrmann, Jr., Assistant Prosecutor, for the State {Mr. Joseph P. Lordi, Prosecutor of Essex County, attorney) .

      Mr. George B. Henkel for defendant {Messrs. Marinello, Henkel, Soriano & Klein, attorneys).
   Yancey, J. C. C.

This is a motion for post-conviction relief, pursuant to R. R. 3 :10A-1 et seq.

Defendant was convicted of rape by an Essex County jury on January 28, 1966. A complaint about the trial judge’s charge was dropped as more appropriate to a direct appeal, and defendant contends on this motion that:

(1) An exculpatory statement taken from him by police officers with respect to the offense and later used at the trial to his prejudice was obtained without advising him of his constitutional rights prior to the taking of that statement, and

(2) He was without sufficient funds for an appeal or motion for a new trial and was not advised of his rights to '.be assigned counsel to prosecute an appeal.

I

As to the statement, the manner in which it was -taken would be relevant to the voluntariness (and thus the probability of truthfulness) of the statement. As the Supreme Court said in State v. Johnson, 43 N. J. 572 (1965), affirmed sub nom. Johnson v. New Jersey, 384 U. S. 719, 86 S. Ct. 1772, 16 L. Ed. 2d 882 (1966), denial of an opportunity to consult with an attorney and failure to be ad-wised of the right to remain silent are factors relevant to the issue of voluntariness. In the statement complained of, defendant admitted intercourse with the prosecutrix but claimed there had been consent. At no time during the trial or at the hearing of this motion did he claim that the statement was untrue or involuntarily given. Yet he would invoke procedural safeguards designed to minimize on all occasions any doubt about the voluntariness of an in-custody statement to invalidate the use of his statement. Even though this court has no doubt about the voluntariness of defendant’s statement to the police, this court would not hesitate to preclude its use if the situation came under the purview of Miranda v. State of Arizona, 384 U. S. 436, 86 S. Ct. 1602, 16 L. Ed. 2d 694 (1966). Miranda held that statements obtained from defendants during incommunicado interrogation in a police-dominated atmosphere, without full warning of constitutional rights, were inadmissible as having been obtained in violation of the Eifth Amendment privilege against self-incrimination.

However, in Johnson v. New Jersey, supra, 86 S. Ct., at pp. 1774-1775, the United States Supreme Court stated:

“In this case we are called upon to determine whether Escobedo v. State of Illinois, 378 U. S. 478, 84 S. Ct. 1758, 12 L. Ed. 2d 977 (1964), and Miranda v. State of Arizona, 384 U. S. 436, 86 S. Ct. 1602, 16 L. Ed. 2d 694, should be applied retroactively. We hold that Escobedo affects only those eases in which the trial began after June 22, 1964, the date of 1hat decision. We hold further that Miranda applies only to cases in which the trial began after the date of our decision one week ago. The convictions assailed here were obtained at trials completed long before Escobedo and Miranda were rendered, and the rulings in those cases are therefore inapplicable to the present proceeding.”

The Miranda case was decided on June 13, 1966. Defendant’s trial was completed on January 28, 1966. Thus, the Miranda safeguards were not applicable during his trial.

Defendant’s trial did take place after June 22, 1964, the date on which Escobedo was decided. However, in Johnson v. New Jersey, supra, 86 S. Ct., at p. 1781, the United States Supreme Court interpreted Escobedo as follows:

“Apart from its broad implications, the precise holding of Escobedo was that statements elicited by the police during an interrogation may not be used against the accused at a criminal trial,
‘[where] the investigation is no longer a general inquiry into an unsolved crime but has begun to focus on a particular suspect, the suspect has been taken into police custody, the police carry out a process of interrogations that lends itself to eliciting incriminating statements, the suspect has requested and been denied an opportunity to consult with his lawyer, and the police have not effectively warned him of his absolute constitutional right to remain silent *•* h* v ^
378 U. S. at 490-491, 84 S. Ct. at 1765.’

See also State v. Billingsley, 46 N. J. 219, 234-236 (1966).

At the hearing defendant testified on direct examination that he had dealt with Irving Rand before and considered him his attorney. However, he also testified that he did not remember if he asked to call Mr. Rand while in custody. Thus, defendant cannot assert that he requested and was denied an opportunity to consult with his lawyer. Accordingly, I am satisfied defendant was not deprived of any constitutional rights in the taking and use of his statement.

II

Defendant testified at the hearing that he was represented at his trial by Mr. Irving Rand, whom he retained with funds provided by an uncle. Upon defendant’s conviction he had exhausted those funds. There was some indication from defendant’s testimony that he might have been able to get additional money for an appeal from the uncle, but defendant himself did not have any funds.

At the hearing defendant testified on direct examination as follows:

“Q. And between the time that you were convicted on January 29th, I believe, and June 17th, 1966, during that time, were you advised by anyone that you had the right to have the Court appoint an attorney to handle an appeal on your behalf?
A. No, sir.
(Objection and ruling)
A. (Continuing) No, sir, I was never advised of any lawyer for appealing or anything like that.
Q. And in fact did you discuss with Mr. Rand whether or not you should try to obtain a new trial or appeal the case?
A. I did, but Mr. Rand didn’t give me any answers or anything.”

Based on this testimony, I find as a fact that defendant did not have funds to retain counsel after his conviction, was aware of his right to appeal the conviction or to move for a new trial, discussed such action with his retained counsel, and took no further action to appeal his conviction. The exact dimensions of the conversation between defendant and Mr. Band were not brought out at the hearing and Mr. Band took no part in the hearing.

With this factual setting, defendant claims his constitutional rights were denied in that no one — not the court nor his lawyer —• advised him that, even though he might not have the funds, the court would assign counsel to assist in his appeal. Defendant claims this right to be offered free counsel was established in Douglas v. California, 372 U. S. 353, 83 S. Ct. 814, 9 L. Ed. 2d 811 (1963). However, in that case the United States Supreme Court merely held that indigent defendants were denied equal protection of the law whore che merits of the one appeal they had as of right from their felony convictions were decided without benefit of counsel, following an independent determination by the California appellate conrt that the appointment of counsel would be of no value to the defendants or to the court. A California rule of criminal procedure provided for such an independent investigation of the record by the state appellate court before the appointment of counsel.

Such was definitely not the case in New Jersey at the time of the defendant’s conviction. At that time the conrt rule for assigning counsel for appeal to indigent persons charged with crime was R. R. 1:12-9 (d) :

“Where an indigent person convicted of crime desires to take an appeal, the appellate court on his verified petition, which shall be substantially in the form set forth in Criminal Procedure B’orm 5C, may assign counsel to represent him. Unless the court otherwise orders, such assignment shall be made prior to the determination by the appellate court of a petition, if any, for furnishing the defendant with a transcript at the expense of the county.”

This rule, which was in effect until July 1, 1967, when the New Jersey Public Defender system commenced, contained none of the infirmities present in the Douglas case. However, there the court construed the import of the case as follows: “Here the issue is whether or not an indigent shall be denied the assistance of counsel on appeal.” 83 S. Ct., at pp. 815-816. Under the court rule in effect at the time of defendant’s conviction and also under the present rule, R. R. 1:12-9 (&), a defendant has the burden of coming forward and indicating to the court that he desires to take an appeal. Even if, as here, a defendant is aware of his state-created right to appeal, he cannot have sufficient opportunity to meet that burden if he is ignorant of his rights to proceed on appeal in forma pauperis and to free counsel, R. R. 1:2-7. Without such knowledge, he may decline to prosecute an appeal solely because of financial inability. If notice of appeal is never filed, such a person would never have the opportunity to be advised of the right to free counsel to prosecute an appeal. Thus, it is important that a defendant upon conviction be informed not only of his right to appeal and filing requirements but also of his right to have counsel provided if he is without resources. Otherwise the State’s appellate machinery would, in its operation, favor the rich and discriminate against the ignorant person of modest means who, at the conclusion of his trial, has become indigent. This would be repugnant to the equal protection clause of the Fourteenth Amendment, for “there can be no equal justice where the kind of an appeal a man enjoys depends on the amount of money he has.” Douglas v. California, supra, 372 U. S., at p. 355, 83 S. Ct., at p. 816, quoting Griffin v. Illinois, 351 U. S. 12, 19, 76 S. Ct. 585, 100 L. Ed. 891 (1956). Cf. State v. Allen, 99 N. J. Super. 314 (Law Div. 1968) and federal cases cited therein. Also cf. In re Garofone, 80 N. J. Super. 259, 276-277 (Law Div. 1963), affirmed on other grounds, 42 N. J. 244 (1964), in which I said that “the spirit of our rules, and the guarantee set forth in our State Constitution, when read together require that a defendant shall have the benefit of consulting and advising with an attorney at every significant step of a criminal cause, unless he knowingly and intelligently relinquishes that right.”

The only question remaining is, who should convey this advice to a defendant upon conviction. Although the old R. R. 1:12-9 did not deal with this aspect at all, the present version of R. R. 1:12-9, effective July 1, 1967, explicitly places this obligation on counsel assigned to represent a person charged with a non-indictable offense. The last sentence of R. R. 1:12-9(c) reads:

“The represen! ation of the defendant by counsel so assigned shall continue through trial and, in the event of a conviction, shall continue through sentencing and shall include advising the defendant with respect to his right to appeal and, if he desires to appeal, the preparation and filing of the notice of appeal and of an application for the assignment of counsel on appeal, but shall not include representation thereafter on such appeal or any subsequent application for post-conviction relief unless further assigned.”

If an indigent is charged with an indictable offense, he can be represented by the Office of the Public Defender. The last sentence of R. R. 1:12-9(a) reads:

“The representation of the defendant by the Office of the Public Defender shall continue through and include any direct appeal from conviction and such post-conviction proceedings or appeal therein as would warrant the assignment of counsel pursuant to court rules.”

Thus, it is impliict under this section of the rule that an indigent represented at trial by a lawyer from the Office of the Public Defender will be fully advised by that lawyer as to his rights of appeal.

The only gap in this scheme of the trial lawyer advising a defendant of his rights of appeal is the situation here where defendant retains private counsel with the last of his resources and becomes indigent at the conclusion of the trial. At first blush the situation here alleged might seem to be a ease of denial of equal protection in reverse — a defendant able to retain his own counsel receiving worse service than a defendant who is not. It is not, however, because the most likely reason for a retained counsel not to discuss the ramifications of an appeal is that the defendant is then indigent and will no longer be a paying client.

Although some might think it merely a recognition of human fallibility, I think it would be inappropriate for a trial judge who has just done his utmost to provide a fair trial for a defendant to have to inform him of his rights of appeal and in effect encourage him to appeal. Rather, this is a function best borne by trial counsel, who will be better able to identify and evaluate grounds for appeal. Also the present R. R. 1:12-9 (a) and (c) indicate that this duty is intended to be placed on trial counsel. Thus, this court believes that the duty of a lawyer, whether retained or appointed, to a defendant client who has been convicted does not end until he has discussed the availability and the advisability of an appeal with him, asked him if he can afford an appeal or other remedy, and, if not, advised him of the availability of assigned counsel.

Although this court is of the opinion that R. R. 1:27A takes precedence over any limitation contained in 1:27B(a) and (d), cf. State v. Allen, supra, it is not necessary at this time to deal with appropriate remedies.

The only evidence presented on the question of whether defendant was advised of the availability of assigned counsel was the testimony of defendant. That testimony raises several doubts as to whether defendant actually and intentionally gave the appearance to his retained trial counsel that he could alford an appeal, thus obviating the need for counsel to advise him, and whether trial counsel did so advise him but defendant did not understand or was not satisfied with what he was told. As to this last question, doubt as to defendant’s credibility is increased by the fact that no testimony, or even an affidavit, was secured from Mr. Eand, defendant’s trial counsel, who is known to the court as an able attorney, experienced in criminal matters. It is very likely that Mr. Eand would not remember the details of their conversation one way or the other. However, I find that the testimony of petitioner in this instance, by itself, is insufficient to overcome the presumption that “he who had a lawyer at the trial had one who could protect his rights on appeal.” Norvell v. Illinois, 373 U. S. 424, 83 S. Ct. 1369 (1963).

Since an application for post-conviction relief is but a modernized, expanded version of the habeas corpus proceeding, the burden of proof of establishing his right to such relief is still with the defendant. He must make such showing “by a fair preponderance of the believable evidence.” In re Lenkowski, 17 N. J. 191, 193 (1955); State v. Cynkowski, 10 N. J. 571, 576 (1952); State v. Jacobson, 28 N. J. Super. 226, 231 (App. Div. 1953). After considering all the evidence presented, including the testimony of defendant and the arguments of counsel, I am satisfied that defendent has not sustained his burden. Cf. In re Lenkowski, supra.

I wish to point out to the defendant that once an order is signed in this matter, except for an appeal on this decision, defendant will not be able to raise the question again at a later date. Once an issue has been fully litigated and decided against a party, it may not be raised again. State v. (Edgar) Smith, 43 N. J. 67, 74 (1964); State v. Johnson, supra, 43 N. J., at p. 578. Thus, I will allow defendant 30 days from receipt of this opinion to notify this court and the prosecutor of his intention and also to submit any additional proofs going to the question of whether defendant was adyised by trial counsel of his right to appeal and his right, if indigent, to have counsel assigned to represent him on appeal. If such notice and proof are not presented, the prosecutor may submit an appropriate order.

       In Norvell v. Illinois, 373 U. S. 420, 422, 83 S. Ct. 1366, 1368, 10 L. Ed. 2d 456, (1963), which dealt with the failure of a state to provide a free transcript of his trial to an indigent defendant because the stenographer had died, the Court stated: “If it appeared that the lawyer who represented petitioner at the trial refused to represent him on the appeal and petitioner’s indigency prevented him from retaining another, we would have a different case. Cf. Douglas v. California, 372 U. S. 353, 83 S. Ct. 814, 9 L. Ed. 2d 811.”

       It might even be argued that, since counsel was retained, petitioner’s remedy lies in a malpractice action, but this is doubtful.


source: Caselaw Access Project

author: Pindar, J. S. C.

license: Public Domain

text:
    THEODORE KIRBY, PLAINTIFF, v. COLUMBIAN INSTITUTE, A CORPORATION OF THE STATE OF NEW JERSEY, DEFENDANT.
    Hudson County Court Law Division
    Decided May 24, 1968.

      Air. John J. Pagano for plaintiff.

      Air. P. Joseph Marley for defendant.
   Pindar, J. S. C.

The issue presented to the Court for its consideration comes before it on defendant’s notice of motion for summary judgment, R. R. 4:58-1 et seq., which is supported with affidavits and briefs, all of which raise a question regarding statutory charitable immunity.

Concisely stated, the pertinent facts are that plaintiff Theodore Kirby was a paying patron of defendant’s bowling alley and bar when on or about September 25, 1964, he was allegedly caused to slip and fall while bowling due to defendant’s negligence in allowing spillage from drinks to accumulate in the bowling area.

Defendant Columbian Institute is a non-profit corporation organized according to its amended charter “to promote the mental and moral improvement of men, women and children.” It was also authorized to purchase lands and erect theron a clubhouse or other buildings. According to the certified copy of defendant’s charter, no one is eligible for membership in the Columbian Institute unless he is a member in good standing of the Knights of Columbus. Plaintiff is not a member of the Institute.

According to affidavit of John E. Bulwith, an officer of defendant, the Institute owns, maintains and controls a building at 667 Avenue C, and 67-69 West 30th Street, Bayonne, New Jersey, site of plaintiff’s injuries. As part of the operation of the building, a bar and bowling alley are maintained and, as was conceded at oral argument, are open to the public. All “fees, monies or donations,” received from the operation of the bowling and bar facilities (which operated under a plenary retail liquor consumption license) become part of the general funds of the Institute, out of which funds the subject facilities are maintained, whether or not their receipts sustain their operations. The building contains other facilities of an undisclosed nature, although at oral argument reference was made to a reading room and banquet hall.

The defendant brings this motion asserting that it comes within statutory charitable immunity pursuant to N. J. S. 2A :53A-7 et seq., and therefore, plaintiff’s cause of action is barred.

The motion was first argued to the Court with reference to plaintiff’s status as beneficiary or stranger to the charity’s works. See, N. J. S. 2A :53A-7. Upon review of the briefs and after consideration of the arguments, the Court directed counsel by its letter dated March 28, 1968, to re-brief and re-argue the motion on the question whether bowling and drinking promote the Institute’s purpose as contained in its amended charter, and if not, the effect of the statute upon the question.

Keeping in mind the legislative directive that the statute in question is remedial and to be liberally construed to afford immunity, N. J. S. 2A :53A-10, the Court is nonetheless confronted by the legislature’s choice of words in effecting its purpose. N. J. S. 2A :53A-7, in relevant part, reads:

“No nonprofit corporation, society or association organized exclusively for religious, charitable, educational or hospital purposes shall * * *” (Emphasis added).

Webster’s International Dictionary (2d Ed. 1950) defines “exclusive” in five different senses, but as used in the statute the only meaning appropriate to the Legislative purpose is the fourth, i. e., “* * * Single; sole * * :|!” Id. p. 890.

Beviewing the original and amended corporate charters filed with the Court it is noticed that in the original charter dated April 16, 1910, the purposes enumerated for the Institute contemplated activities to promote the “moral, social, intellectual, material and physical welfare and advancement of its members; to purchase lands and to construct and erect thereon a clubhouse or other buildings * * * (Emphasis added).

It seems clear the Institute was not originally intended as a public charity, but rather it was intended to function like a fraternal association for members of the Knights of Columbus. Having altered its charter to broaden its purpose, i. e., “to promote the mental and moral advance of men, women and children,” which for the present may be assumed to be charitable, why therefore, was the corporation to continue to maintain a clubhouse as one of its purposes? Clubhouses are for members only, and are not open to the public. A “public clubhouse” is a contradiction in terms, and certainly the incorporators did not intend so strained a construction of their charter. The more natural construction of the charter is that the institute was to function or to continue to function as a fraternal society for its members as well as to perform other services of a more public nature. It seems clear, therefore, that the Institute was organized for two purposes; one of which was charitable, and the other not charitable but rather mutually advantageous to club members. Of course it cannot be gainsaid that not every nonprofit corporation is charitable, 1 Fletcher, Cyc. Corporations, § 79, p. 361 (Perm. Ed. Rev. 1963) ; and those non-profit corporations which are not devoted solely and exclusively to religious, charitable, educational or hospital purposes, or to a combination of these permissible purposes, do not enjoy statutory charitable immunity. See, Gould v. Theresa Grotta Center, 83 N. J. Super. 169 (Law Div. 1964) affirmed, 89 N. J. Super. 253 (App. Div. 1965). Fraternal societies or those organizations whose purpose is to promote the welfare of their members are benevolent, but not charitable. 1 Fletcher, op. cit. § 79, at p. 367. And, therefore, the Court is constrained to hold that the Columbian Institute under the aforementioned amendment is not organized exclusively for charitable, religious, educational or hospital purposes, and does not enjoy the immunity granted by N. J. S. 2A :53A-7 et seq. Because there is no longer any common law immunity outside the scope of the statute, see, Collopy v. Newark Eye and Ear Infirmary, 27 N. J. 29 (1958), the defendant must be held responsible for its torts on the same basis and for the same reasons as any other suable entity. See, R. S. 15 :1-4(b); 16 :1-4(b).

Although the conclusion above is by itself sufficient to deny defendant’s motion for a summary judgment, the Court wishes to indicate to counsel its opinion regarding the question to which counsel addressed themselves at the Court’s request upon re-briefing and re-argument, i. e., whether bowling and drinldng promote the mental and moral improvement of men, women and children. The defendant argued that the mental and moral improvement of mankind are promoted by educational “pursuits” in a “controlled environment,” and that the term “education,” concededly of broad and indefinite conceptual limits, includes recreational activities as well as all forms of human experience. See Stoolman v. Camden County Council Boy Scouts of America, 77 N. J. Super. 129 (Law Div. 1962).

But it is precisely this last contention, i. e., that “life” is an educational experience, which although indubitably true, is .nonetheless problematic for the Court in effectuating the legislative intent. If defendant’s contention were accepted it would lead to the conclusion that every nonprofit organization was engaged in educational pursuits as a matter of law, and therefore all such corporations were immune from tort liability. But such an absurd result could not reasonably have been intended by the Legislature.

Although no New Jersey case seems to have considered the precise problem here involved, those jurisdictions which have seemed to adopt the rule that when an otherwise charitable or educational organization engages in commercial activities bearing no substantial and direct relation to its general charitable or educational purposes, such organization loses whatever immunity it would otherwise enjoy despite the fact that the profits derived from the commercial activity are used for the organization’s charitable purposes. See, the eases collected in 25 A. L. R. 2d, 29 (1952) at 130; 15 Am. Jur. 2d, Charities, § 169; 10 Fletcher, op cit., § 4937, at 848 (Perm. Ed Rev. 1961). The rule enunciated should be contrasted with those New Jersey cases which hold in part that charities do not lose their immunity by virtue of the fact that certain fees are charged for their charitable services, which holdings are not inconsistent with the rule stated above. See, e. g., Hauser v. Y. M. C. A., 91 N. J. Super. 172, at p. 177 (Law Div. 1966).

Reading the language of the statute, it seems clear that the Legislature never intended to allow charities or educational institutions to open a business with the obvious competitive advantage they would enjoy if they were immune from suits for their torts. The critical question in a legal anaylsis of the issues is one of characterization, i. e., is the questioned activity out of which the suit arises commercial or charitable in nature. See, Allison v. Mennonite Publications Board, 123 F. Supp. 23, at p. 28 (D. W. D. Pa. 1954).

In the present case the Court is of the opinion that operating a public bar and bowling alley for profit is clearly a commercial activity bearing no substantial and direct relation to the mental and moral improvement of men, women and children. This is not to say that the defendent has exceeded its corporate powers, a question not before the Court, but simply to assert that the defendant does not enjoy immunity by virtue of our statute when it operates a public bar and bowling alley.

The justice of the rule is to be found in several considerations. First, the Court will take judicial notice of the fact that there are a plethora of combination bar-bowling alleys in New Jersey which provide recreation to residents of our State for a profit. For the fees charged these enterprises assume a duty towards their patrons, that of landowner or proprietor to business invitee, one of the highest duties in the law. Compensation for torts committed by these commercial establishments must be satisfied from the profits of the venture before any individual owner or shareholder receives his share of the net proceeds. This Court does not think that the Legislature intended a different treatment for charitable organizations which open to the public at comparable prices similar facilities whose necessary effect is to compete with other commercial enterprises.

Secondly, focusing upon the language of N. J. S. 2A :53 A-7, it is noticed that the Legislature has adopted the traditional beneficiary-stranger dichotomy as developed by the Courts as an exception to the judicially created charitable immunity. Therefore, it seems that the Legislature was simply reasserting, perhaps broadening, the common law immunity which prevailed until the Supreme Court overruled the theory in its entirety in the Collopy decision, supra. To this extent the statute is declaratory of the common law development in the Courts until 1958. See, Anasiewicz v. Sacred Heart Church, 74 N. J. Super. 532, at pp. 535-536 (App. Div. 1962). But because there had been no case in New Jersey dealing with the present question at the time the legislation was enacted, the Legislature did not contemplate the present question when it preserved the common law immunity as expressed in the statute, and so the question is an open one. In the absence of the statute it is conjectural to conclude that the Supreme Court would have created a second exception to the general rule of charitable immunity, but in view of its later decision in Collopy it seems that the Court would have been favorably disposed to do so, in an appropriate case. See, Bell v. Salvation Army, 172 Ohio St. 326, 175 N. E. 2d 738, 740 (Sup. Ct. 1961).

The Hauser v. Y. M. C. A. case, supra, cited by defendant is. not inconsistent with this Court’s general observations and opinions because there the Court specifically found as a matter of fact that “Its (Y. M. C. A.’s) fees do not begin to cover the entire cost of operating its extensive facilities, and so it turns to fund raising to carry out its major purpose * * *” 91 N. J. Super., at p. 178. This Court points out that its present opinion is based upon the fact that this charity is operating a profit making business.

Thirdly, buttressing this Court’s conclusion, attention is directed to the statutory language, specifically to N. J. S. 2A :53A-10, wherein the Courts are directed to construe the statute to the end that charities may be protected. Prom what should charities be protected? The only responsive answer is "depletion of their trust funds.” That is the principal purpose of the legislation. But when a charity is required to compensate the victims of their torts committed in the course of profit making commercial activities, the charity’s trust funds are not depleted if as a cost of doing business the charity is required to compensate their victims from their profits before they are committed to more general purposes. Construing the statute as a whole with this legislatively declared policy in mind, there is no judicial frustration of the statute’s purpose if charities are made answerable for their torts committed while engaged in a profit making venture.

In the light of the foregoing, it is determined that defendant’s motion will be denied. On the basis of the stated conclusion the issue of plaintiff’s status as a beneficiary is irrelevant and determination thereof becomes unnecessary.


author: Goldmann, S. J. A. D.

text:
    IN THE MATTER OF SHORE HILLS WATER COMPANY, APPLICATION NO. 1366 TO DIVERT WATER FROM A WELL IN THE TOWNSHIP OF ROXBURY, MORRIS COUNTY. SHORE HILLS WATER COMPANY, A CORPORATION OF NEW JERSEY, APPELLANT, v. WATER POLICY AND SUPPLY COUNCIL, DIVISION OF WATER POLICY AND SUPPLY, DEPARTMENT OF CONSERVATION AND ECONOMIC DEVELOPMENT, RESPONDENT.
    Superior Court of New Jersey Appellate Division
    Argued February 19, 1968 —
    Decided June 4, 1968.

      Before Judges Goldmaue, Lewis and Cajrton.

      Mr. John B. Sailer argued the cause for appellant (Mr. Bussell Fleming, Jr., on the brief).

      Mr. Joseph M. Jacobs argued the cause for respondent township (Messrs. Harrison & Jacobs, attorneys; Mr. Joseph Harrison, of counsel; Mr. Donald 8. Coburn, on the brief).

      Mr. Arthur J. Sills, Attorney General of New Jersey, filed a statement in lieu of brief on behalf of respondent Water Policy and Supply Council; Mr. Alan B. Bothstein, Deputy Attorney General, of counsel.
   The opinion of the court was delivered by

Goldmann, S. J. A. D.

Shore Hills Water Company (Shore Hills) appeals from a decision of the Water Policy and Supply Council, in the Division of Water Policy and Supply, Department of Conservation and Economic Development, denying its application for approval of plans to divert a maximum average of 720,000 gallons of water daily during any month from a new rock well to be located on the west side of Center Street, Roxbury Township, beyond the company’s franchised area and some 3,000' from the terminal point of its main.

I

Shore Hills is a relatively small private water supplier. About 95% of its franchised area (approximately the same percentage as its 940 customers) is located in the northern section of Roxbury Township. The remainder lies in the adjoining Borough of Mount Arlington. Roxbury Township has its own water system; additionally, there are seven other private water suppliers, including Shore Hills, serving scattered areas of the township.

Shore Hills’ present source of supply is two wells, one with a nominal rating of 50 gallons a minute (about 58,000 gallons a day) and the other with a nominal rating of 250 gallons a minute (about 288,000 gallons a day) — a total just short of 350,000 gallons a day. The company also maintains two storage tanks with a total capacity of 315,-000 gallons, designed to provide peak hour flows for general service and fire service. These wells and tanks are all located within the company’s franchised area.

Roxbury Township’s concern for the orderly and economical development of an overall water and sewer master plan for the entire municipality began to take definite form in 1960. The governing body made a policy determination that real estate developers would have to install sewers instead of septic tanks; and, further, the township would conduct negotiations with a view to acquiring the private water companies, so that Roxbury would have its own integrated municipal water system. The township engaged consulting engineers to prepare a master water plan, and test wells were drilled in the northern part of the township which revealed the presence of a good well field.

As a next step in developing a coordinated water supply distribution system, the township applied to the Water Policy and Supply Council in 1961 for diversion rights from a well to be located south of Center Street in the previously discovered well field. The application was granted following a public hearing.

Shore Hills’ present application is substantially the same as one made and denied in 1965 when the company sought permission to locate an additional well on a site west of Center Street (the same site as is here involved) located 3,500' outside the company’s franchised area and within 1,700' of the township’s present well. Rosbury Township voiced its objection at the hearing on that application. On May 11, 1965 the Council denied the application but allowed the company to increase its diversion rights from an average of 200,000 to an average of 325,000 gallons daily during any one month. There was no appeal from that determination.

Rosbury Township thereafter requested an extension of time on the diversion rights granted under its 1961 application. Shore Hills appeared and participated as an objector at the August 1966 hearing on the request. The Council granted the extension. In the meantime, Shore Hills had on July 5, 1966 filed the application here involved, to divert 720,000 gallons daily during any month from the proposed new rock well.

Rosbury Township filed a formal objection in advance of the hearing on that application. Among the reasons set out were that (1) the requested diversion would be from a well situated substantially outside the company’s franchised area, and the township had not consented to Shore Hills extending its lines into the area from which the proposed water supply was to be drawn, nor did the governing body intend to grant such consent; (2) the Council had in 1961 granted the township the right to withdraw 500,000 gallons of water daily from its well (now in operation) situated in close proximity to the company’s proposed well, and the township had installed water mains throughout the area; (3) the company’s present application was identical to the one denied by the Council in May 1965, and there had been no material change in circumstances in the interim; (4) the company had sufficient water sources from which it could adequately supply customers within its franchised area — in fact, the Council had in May 1965 granted it permission to divert additional water not exceeding an average of 325,000 gallons daily during any one month from its existing wells; (5) the productive capacity of the township’s well would be adversely affected by the company’s proposed water diversion, and (6) the township’s progress toward a municipally-owned system contemplated a water and sewer system servicing the entire community, and the company’s proposed water diversion would interfere with the township’s plans. The township also gave notice that it entered such further objections as were developed at the 1965 hearing on the company’s prior application.

At the January 9, 1967 hearing on the application here in question Shore Hills presented two witnesses: its vice-president and its engineer, Borghard, who testified as an expert that the requested well was necessary to meet anticipated needs. Essentially, the company attempted to support its case by updating the exhibits it had presented at the 1965 hearing involving a similar application. In denying the latter the Council had directed the company to file a report “regarding further explorations for additional water supply within the presently franchised area, within one year from the date hereof.” The company had made no attempt to comply with that requirement. Meanwhile, the township had, between the 1965 and 1967 hearings, installed 2,000' of water mains along Center Street. About half the length of the water main the company planned to install along Center Street to the proposed well site would parallel the entire 2,000' length of the township’s main. (It would appear from the record that since the township proposed to extend its existing main and install new mains, to grant the company’s application would involve a further paralleling of water mains in this area of the township.)

Boxbury Township’s witnesses were its consulting sanitary engineer and the chairman of its sewer and water utility committee, who was also a member of the township committee and township planning board. Their testimony was to the effect that the proposed well would seriously interfere with the integrated system the township was then in the process of establishing. That system called for the condemnation of all private water company property and the distribution of all water in the township by a municipally-owned utility. Their testimony also tended to contradict directly that of Shore Hills’ engineer.

Following the hearing the attorneys for the company and the township submitted summations in letter form. The three members of the Council who had heard the testimony prepared a summary of the evidence and a recommended resolution which was incorporated in the resolution adopted by the Council on March 23, 1967 denying the company’s application without prejudice.

The resolution here under review recited, among other things, that the Council had in its deliberations taken into consideration the records of the hearings on the respective applications of the township in 1961 and the water company in 1965; that the company’s proposed well was located 3,500' outside its franchised area and within 1,700' of the township’s existing well, which would involve construction of a transmission main paralleling throughout half its length the township’s existing water main; that the company wanted the additional water as a standby supply in case one of its two wells failed or a water main broke; that a standby facility by way of interconnection with the township was available to supply the quantity of water the company was authorized to use; and, finally, since those being served by the company did not have proper or adequate sewage disposal facilities and were presently using septic systems which threatened to contaminate not only their own surface and subsurface resources but those of the surrounding areas as well, it was not considered advisable to grant the company’s application until such time as adequate sewerage services were available.

II

In an effort to conserve and most effectively use the water resources of New Jersey, the Legislature established the State Water Policy Commission. See R. S. 58:1-1 et seq., as amended. All the functions, powers and duties of the Commission were subsequently transferred to the Division of Water Policy and Supply, of which the Water Policy and Supply Council is the deliberative body. N. J. S. 13 :1A-9, 13 :1B-50.

An application to tap any natural water source must be made to the Council, R. S. 58:1-18. A hearing is held and objections filed, R. S. 58 :1-19. The Council then determines whether the application is justified by “public necessity,” R. S. 58 :l-20, and it may approve, modify or deny the request, B. 8. 58 :1-21. Any party aggrieved by the decision may seek review by a proceeding in lieu of prerogative writs, as in this case, N. J. S. A. 58 :l-22.

III

Shore Hills argues that the denial of its application was not justified by facts properly before the Council. It is first contended that Council’s consideration of the records of the hearings on the two prior applications (in 1961 and 1965) “was improper and in violation of fundamental procedural requirements.

At the conclusion of the January 9, 1967 hearing on Shore Hills’ latest application, the attorney for Roxbury Township moved to introduce into evidence “all the exhibits * * * within the possession of the Council that were introduced by the Township of Roxbury * * * under Application Number 1067, and that consisted of two hearings * * *” and, after some further explanation, “the exhibits that were introduced at the hearing of the application of the Shore Hills Water Company under Application 1231, which is really and essentially and actually the very same application that is being made here today.” When the attorney for Shore Hills objected, the township attorney pointed ont that the company participated in each of the prior hearings and was supplied with copies of the exhibits. At this point the deputy attorney general representing the Division of Water Policy and Supply expressed the opinion that “the previous records of any applications that may have some bearing on this hearing may be taken into consideration by the Council” without the necessity of introducing them as part of the record of the proceedings. The township attorney found that arrangement “satisfactory.” The chairman then stated that the Council would use “its own best judgment” in considering the prior records, and noted that “almost all present at this hearing have been at the other hearings also.” There was no further objection on the part of Shore Hills.

We perceive no ground for the complaint presently made by the water company. Shore Hills’ argument is that the prior records were irrelevant and immaterial, and any consideration given them by the Council denied the company the right of cross-examination. To this it adds a policy thrust — that under Rule 4 of our Rules of Evidence (1967) matters not of demonstrated probative value should not be allowed to swell the record unduly.

That the prior records were not actually introduced in evidence, but that the Council took official notice of its prior proceedings, is not of significant importance. The true question is whether the administrative agency, in looking beyond the four corners of the record then made before it, substantially prejudiced either of the parties. United States v. Pierce Auto Freight Lines, 327 U. S. 515, 66 S. Ct. 687, 90 L. Ed. 821 (1946), cited with approval and quoted to that effect by our Supreme Court in Pennsylvania Railroad Co. v. Department of Public Utilities, 14 N. J. 411, 428 (1954).

It is significant that in the latter case 'the court, in finding that the railroad was not prejudiced because during the course of the departmental hearing it was not put on notice that official notice would be taken by the agency of certain related prior proceedings, said that the railroad was fully aware of those proceedings because it had in considerable measure participated therein. 14 N. J., at page 429. Quoting from Pierce Auto, the court continued:

“In the absence of any showing of specific prejudice, the claim comes down to the highly technical objection that the Commission, in the final stage of forming its judgment, could not in either case take account of what had been done in the other, notwithstanding the closely related character and objects of the applications and the prior proceedings. The contention in its farthest reach amounts to a legal version of the scriptural injunction against letting one’s right hand know what one’s left hand may be doing,
Obviously it would be consistent neither with good sense nor, we think, with the tyjie of hearing assured by the statute to force the Commission to put on such complete blinders.” (at pages 429-430)

In tbc present case the position of Shore Hills is even less compelling. It had notice at the hearing that the Council would take official notice of the prior hearings. Shore Hills participated in all those hearings and therefore had the opportunity of meeting the township’s offers of proof by cross-examination and rebuttal, in furtherance of precisely the same interests as it advances in the present case. Since the subject matters of the prior proceedings were the same or directly related to that before the Council in the present application, it is difficult to understand Shore Hills’ argument that the matters previously considered were irrelevant and immaterial. Cf. R. S. 58:1-14.

Official notice has long been a respected part of administrative deliberations, both in Now Jersey and under federal administrative law. See Pennsylvania Railroad Co. v. Department of Public Utilities, above. Thus, approval of its use here, rather than opening a Pandora’s box (appellant’s reference) and permitting irrelevancies to cloud real issues and clog the record on appeal, follows respectable precedents which acknowledge a salutary power of administrative agencies — a power which greatly contributes to the effective completion of their appointed tasks. Ibid.

No prejudice has been demonstrated by Shore Hills. Such is its burden if it may successfully attack Council’s right to take official notice of directly related proceedings previously before it. Having failed to carry this burden, its argument must fail.

IY

Shore Hills next argues that there was not sufficient evidence to support Council’s denial of the application. It takes issue with that part of the resolution which recites that the company desires the requested quantity of water as a standby supply in case of the failure of one of its two wells, or a water main break. On direct examination Shore Hills’ expert, engineer Borghard, was asked what amount of storage or water diversion was considered necessary for the company to be prepared for an emergency such as a main break or a fire. His reply was that the storage available was, in his opinion, sufficient and that he would not recommend additional storage. Rather, “we need the ability to replace the largest [well] plus additional supply for increased per capita use, expansion on the system, and unusual conditions of drought, fire or main failure.”

As to this first alleged erroneous finding, it is clear, on the basis of ample evidence, that Shore Hills’ present capacity well exceeds actual need. It has two wells producing about 300 gallons a minute (the daily figure given was 346,000 a day), while the average daily consumption rate is 137 gallons a minute. In addition, there is available the 315,000 gallons held in the two storage tanks. The purpose of that storage, said Borghard, is “to take out the peaks for the day.”

Considering the rated capacity as compared to the rate of consumption, as well as the existence of the 315,000 gallons of stored water (an amount exceeding the number of gallons used on the highest-use day of four 1966 months, and only 135,000 less than the highest use on a single day of that year), together with Borghard’s testimony that the new well was needed to supplement the present sources, we conclude that the challenged finding was proper.

The second Council finding complained of is that part of the resolution which states that “a standby facility in the form of an interconnection with the Township of Eoxbury is available to supply the quantity of water which the applicant is now authorized to use.” The testimony of the chairman of the township’s sewer and water utility committee made it explicit that such an interconnection would be available for standby purposes.

“* * * the water which we are developing now and which we have available is not only available to our own individual customers and consumers but also would be available to anyone who had a need for it, including any other water company which may need it as a supplemental system or supply.”

Shore Hills has now embraced that offer. In June 1967 it filed a petition for interconnecting its system with the township’s, requesting that Council issue an interconnection order under R. S. 58 :1-25.

Finally, Shore Hills attacks the finding that its customers lack proper or adequate sewage disposal facilities; that they are presently using septic systems which threaten to contaminate their own surface and subsurface resources as well as those in the surrounding areas, so that it was not considered advisable to grant the company’s application until such time as adequate sewerage services were available. The company claims that the sewage problem was mentioned only once in passing. To the contrary, we find the subject mentioned at various points in the record. The problem of the inadequacy of sewerage facilities in the township has long concerned the governing body. Its consulting sanitary engineer testified to the importance of installing sanitary sewers throughout the township, and discussed the status of the plans therefor. The water company’s witness disclosed that only septic tanks were in use in the franchised area. One of the Council members observed that eventually the septic tanks would “pollute the whole area.”

The Council was familiar with the urgent pollution problem that had developed in the area of the township immediately south of Shore Hills’ franchised area. In the report filed by the Council members who conducted the hearing, reference was made to those portions of the stenographic record of the hearing on the township’s 1961 application which dealt with the pollution problem and the township’s plans to alleviate the condition. Thus, as the township’s appellate counsel points out, when one of the Council members in the course of the hearing raised the problem of contamination he was directly calling attention to a factor of deep concern. This is borne out by the resolution adopted by the Council just two months after it had determined the water company’s application. That resolution reflects the expert knowledge previously developed by the Council to the effect that “the water resources * * * of the State are rapidly becoming subject to severe contamination and pollution because of the intensive and burgeoning growth and development taking place throughout the State.” The resolution further states that “to ameliorate this ominous threat to the State’s water supply and the resultant effect upon the health of our citizens, more effective sewage and waste treatment facilities are essential.” The Council therefore resolved that it would not approve any proposed plan for water supply development or allocation, absent sufficient evidence that adequate waste disposal facilities will be provided.

The Council does 'not operate in a vacuum. It is an agency with presumed expertise in the entire field of water supply — from the tapping of sources, through distribution of water, to the eventual return of the water after its use. Thus, R. S. 58:1-11 states as part of the purposes of the State Water Supply Commission, of which the Council is successor,

“* * * to 00mpiete a comprehensive study for the entire state, for the conservation, development, regulation and use of the waters, in each of the principal watersheds of the state with reference to the accomplishment of * * *:
a. the supply of pure and wholesome water from the watersheds to the municipalities and the inhabitants thereof and the disposal of sewage and wastes which may affect the supply. * * * * * * * i:” (Italics ours)

An agency with the expertise commanded under this statute is within the proper bounds of its authority in finding that the existence of septic tanks in Shore PTills’ franchised area will contaminate the water sources in that locale. Not only upon the basis of what had indisputably been developed at the hearing, but by reason of its previously acquired knowledge of sewerage conditions in the area, the Council was amply warranted in resolving that it was inadvisable to grant the company’s application until adequate sewerage service was available. Our courts do not require an administrative agency to act upon particular applications with eyes and mind completely averted from a known situation.

Our Supreme Court only recently recognized that in the discharge of its legislative mandate, and with particular regard to pollution prevention, the Council “has the power and duty to protect the source of State water supply from contamination”; the Council and its agents, it said, had developed “a singular expertise and are unusually qualified to pass judgment on that subject.” Juzek v. Hackensack Water Co., 48 N. J. 302, 310-311 (1966).

See also Jersey City v. State Water Policy Comm’n, 118 N. J. L. 72 (E. & A. 1937). This was an appeal from a State Water Policy Commission hearing at the outset of which the Attorney General advised the Commission that it lacked jurisdiction concerning “the question of the sanitary condition of water” and that “the contamination of such water, after impounding, is for departments other than yours.” The court held this to be “a fundamental misconception of the expressed legislative policy,” stating that the Commission was “designed to lay down a broad and comprehensive policy for the conservation and protection of the 'surface, subsurface and percolating waters of the state* through control and regulation of the 'use, development and diversion’ of such waters.” See R. S. 58:1-10, and note R. S. 58:1-18 (second paragraph) and R. S. 58:1-20. In discussing the question of the purity of water and what department had general supervision over that problem, the court went on to say that

“ * * * the purity of the state’s potable water supply is of necessity a pre-eminent factor in the valid exercise of the powers thus conferred upon the commission. The legislature, by this enactment [L. 1929, c. 267, now R. S. 58:1-1 et seq.], recognizes that the safeguarding of such water sources and streams against pollution is a primary function of government. The toll in health, and life itself, of disease-laden waters devoted to potable uses is immeasurable. And the economic waste, to say nothing of the grave individual consequences of such contamination, is likewise incalculable. Assuming, but by no means conceding, that the letter of the statute is ambiguous, it is implicit therein that qualitative as well as quantitative considerations shall govern the commission in the discharge of the duties laid upon it. And the former plainly have dominance. * * *” (118 N. J. L., at pages 75-76)

Y

As a second major contention, Shore Hills argues that the Council has no power to deny subsurface diversion because of inadequate sewerage facilities in the area served. The difference between this argument and the one just discussed lies in its emphasis upon lack of authority rather than whether sufficient evidence of the nonexistence of such facilities would support the Council’s finding.

'.■Sufficient authority to deny the application for the reasbn'stated by Council may be found in R. S. 58 :1-1 et seq., as amended, and specifically in R. S. 58:1-11 (a).

., The water company would have us find a distinction between the Council’s control over surface as opposed to subsurface sources of potable water. Surely, subsurface waters are entitled to the same protection as surface waters, for were this not true, Council would not have had the power to pass upon Shore Hills’ application since it involves a subsurface source. R. S. 58 :1-10 undercuts the company’s present claim. It states:

“The commission [now Council! shall have general supervision over all sources of potable and public water supplies, inoludinff surface, subsurface and jjercolating waters, to the end that the same may be economically and prudently developed for public use.” (Italics ours)

Shore Hills contends that this statute was not included in the grant of power to the Council under N. J. S. A. 13 :1B-50. It has apparently overlooked N. J. S. A. 13 :1A-9, which provides, in pertinent part, that “the functions, powers and duties, records and property of the State Water Policy Commission * * * are hereby transferred to and vested in the Division of Water Policy and Supply established under this act [L. 1945, c 22], to be exercised and used by the council thereof, in accordance with the provisions of this act.”

There can be no doubt that the Council acted in the exercise of the general supervisory authority granted it by R. S. 58 :1-10. This position is supported by the Jersey Giiy and Juzek cases referred to above.

In asserting that the Council lacks specific power over subsurface waters in relation to septic tanks or sewerage contamination, Shore Hills would avoid a determination of the question by that agency on a claim that jurisdiction properly lies in the State Department of Health. By removing the matter from consideration by the Council it would gain the right to tap a new water source while another agency was in the process of considering the contamination issue — a decisional process which might well take a considerable time. Before any such determination could be made, condemnation of its property by the township would inevitably have taken place; the matter would he moot insofar as Shore Hills was concerned and the problem have become one for the township to meet. In the meantime, the water company would enjoy increased diversion rights, at a profit to itself.

We cannot subscribe to any strained reasoning which would effectuate so transparent a plan. We find nothing in R. S. 58 :1-1 et seq., as amended, to justify a holding that Council lacks the power to deny an application on the ground that septic tanks will pollute the water source, and. therefore no increased diversion will be granted until proper facilities exist. The statute runs directly contrary to such a theory and to the broad construction that must be given the legislation if it is to achieve its salutary purposes. The only reasonable conclusion is that Council had complete power to make the challenged determination.

The decision is affirmed in all respects.


author: Lewis, J. A. D. Kolovsky, J. A. D.

text:
    110-112 VAN WAGENEN AVENUE COMPANY, A LIMITED PARTNERSHIP, PLAINTIFF-APPELLANT, v. MILTON A. JULIAN ET AL., DEFENDANTS-RESPONDENTS. 110-112 VAN WAGENEN AVENUE COMPANY, A LIMITED PARTNERSHIP, PLAINTIFF-APPELLANT, v. MILTON A. JULIAN ET AL., DEFENDANTS-RESPONDENTS.
    [DOCKET NO. L 8169-66]
    [DOCKET NO. L 23025-66]
    Superior Court of New .1 ersey Appellate Division
    Argued January 29, 1968 —
    Decided June 6, 1968.

      Before Judges Gaulkin, Lewis and Kolovsky.

      Mr. Matthias D. Dileo argued the cause for appellant {Messrs. Wilentz, Goldman & Spitzer, attorneys; Mr. Francis X. Journick, of counsel; Mr. Stephen F. Bar can, on the brief).

      Mr. David Jerchower argued the cause for respondents Milton A. Julian and Shirley Julian {Messrs. Kessler & Kessler, Mr. Samuel I. Kessler, of counsel).
   The opinion of the court was delivered by

Lewis, J. A. D.

Plaintiff’s action to recover the amount due on a bond secured by a second real estate mortgage on property in Hudson County, whose lien had been extinguished by the foreclosure of a prior mortgage, was dismissed by the trial court on motion of defendants Julian.

The foreclosure sale took place on February 24, 1966. Plaintiff’s suit was instituted on November 16, 1966, well within the time limit under N. J. S. 2A :50-8. The trial court’s decision was based on the fact that plaintiff had not filed in the office of the Register of Hudson County, before snit was commenced, a written notice of the proposed action. The court held that such an antecedent notice was a prerequisite, under N. J. S. 2A :50-10 (herein section 10), to plaintiff’s right to maintain an action on its bond.

Plaintiff appeals, contending (1) its suit as a junior mortgagee for deficiency did not reopen the mortgagors’ equity of redemption (N. J. S. 2A:50-9) and, therefore, the section 10 notice served no conceivable purpose and should not be enforced, and (2) defendants are estopped by their conduct from asserting the provisions of that section as an affirmative defense. For reasons hereinafter stated we reverse.

Section 10 provides:

“No judgment shall be entered by confession or in any action upon any bond pursuant to section 2A :50-8 unless prior to the entry of the judgment, if by confession, or prior to the commencement of the action on the bond, if the proceeding be by action, there shall be filed and recorded in the office of the clerk or register of deeds and mortgages as the ease may be, of the county, in which the mortgaged premises are situate, a written notice to the same effect and in the same manner as is required by sections 2A:50-6 and 2A :50-7 of this title.”

The aforementioned sections 6 and 7 deal with suits for deficiencies by mortgagees who have foreclosed their mortgages. The former section mandates the filing of a notice of intention before a foreclosing mortgagee may sue on a bond fox a secured debt, and the latter section provides for the recording of filed notices. They promote an important function because a deficiency judgment upon a bond secured by a mortgage which has been foreclosed reopens the foreclosure and gives the mortgagor six months within which to redeem the property. N. J. 8. 2A :50-4. The basic underlying purpose of sections 6 and 7 (originally enacted as L. 1907, c. 231) is to stabilize titles to mortgaged lands purchased under foreclosure sales. Neu v. Rogge, 88 N. J. L. 335, 339-340 (E. & A. 1915); O’Connor v. Briscoe, 119 N. J. L. 362, 365 (E. & A. 1938). As the Rogge court pointed out, the clear legislative intent was to provide, through the means of a public record, a method “to make secure the title to a purchaser of mortgaged lands which had been foreclosed * * * and which were subject to redemption * * *” (at p. 33-9). In O’Connor the required filing of a lis pendens under section 6 (then section 51 of the Mortgage Act, 3 C. S., p. 3423) was held to be mandatory since “it declares a public policy for the conservation and protection of the public records relating to the title to lands.”

The ratio decidendi of those cases, however, is inapplicable to situations embraced by sections 8, 9 and 10, which were adopted in 1942 (L. 1942, c 172, §§ 1, 2 and 3). Section 8 deals with actions on a bond where the mortgage lien has been extinguished by foreclosure of a prior mortgage, and requires the action to be commenced within one year after the sale of the property or confirmation thereof. Section 9 provides specifically that the proceedings “shall not open the foreclosure and sale of the mortgaged premises or result in any right of redemption.” When the legislative history of the various sections of the statute dealing with proceedings upon mortgage bonds is analyzed and the statutory language construed in pari materia “to effectuate general legislative policy” (State v. Wean, 86 N. J. Super. 283, 289 (App. Div. 1965)), there appears to be no basis in history, public purpose or meaningful function for the existence or enforcement of the notice requirement of section 10. That section relates to proceedings by a junior lienor whose security has been extinguished, and no one is affected by the outcome of the suit on the bond other than the parties themselves. Indeed, in the instant matter, the litigants conceded that the notice requirement serves no conceivable purpose.

The only reasonable deduction is that the inclusion of section 10 in the 1942 enactment was the product of mistake or inadvertence bjr the Legislature in paraphrasing sections 6 and 7 which had been on the statute books since 1907. Accordingly, plaintiff argues that section 10 should be declared a nullity.

There is ample authority for the proposition that statutory interpretive technique permits the deletion and disregard of legislative language when the rejection thereof is essential to reach and carry out the purpose of the Legislature.

Professor Llewellyn, in his “'Eeinarks on the Theory of Appellate Decision and the Eules or Canons About How Statutes Are to be Construed,” 3 Van. L. Rev. 395, 404 (1950), observed that the thrust of “Every word and clause must be given effect,” is parried by an equally important rubric, “Tf inadvertently inserted or if repugnant to the rest of the statute, they may be rejected as surplusage.” Stated differently:

“While, as a general rule, every word in a statute is to be given force and effect, * * * unnecessary words or clauses, words inadvertently or mistakenly used, words to which no meaning at all can be attached, or words having no meaning in harmony with the legislative intent as collected from the entire act will be treated as surplusage, and will be wholly disregarded in the construction of the act in order to effectuate the legislative intent.” 82 C. J. S. Statutes § 343, pp. 687-688 (1953).

Many interpretive decisions have recognized and invoked that principle of statutory construction, including Brotherhood of R. R. Trainmen v. Central R. R. of N. J., 47 N. J. 508, 517-518 (1966) (section of prior enactment inadvertently repealed by subsequent act); Schierstead v. City of Brigantine, 29 N. J. 220, 230-231 (1959) (absurd consequences from the literal reading of a statute are to be avoided); Westinghouse Electric Corp. v. United Electrical, etc., 139 N. J. Eq. 97, 105 (E. & A. 1946) (subsection of Anti-Injunction Act declaring other subsections to be lawful was mere surplusage) ; Perry v. Commerce Loan Co., 383 U. S. 392, 400-401, 86 S. Ct. 852, 15 L. Ed. 2d 827, 833-834 (1966) (incorporation of section of Bankruptcy Act among prerequisites for confirmation of wage-earner extension plan was legislative oversight); Baltimore Lumber Company v. Marcus, 208 F. Supp. 852, 858 (D. Md. 1962) (clause tending to nullify coverage of statute should he omitted); American Federation of Labor v. Mann, 188 S. W. 2d 276, 282 (Tex Civ. App. 1945) (express and inclusive language of subsequent section of Labor Act made preceding section mere surplusage); Arkansas Oak Flooring Co. v. Louisiana & Arkansas Ry. Co., 166 F. 2d 98, 101 (5 Cir. 1948), certiorari denied 334 U. S. 828, 68 S. Ct. 1338, 92 L. Ed. 1756 (1948) (a clause need not be applied literally or at all if such application would provide a result contrary to the primary purpose of the statute); Mason v. Bowerman Bros., Inc., 95 R. I. 425, 187 A. 2d 772, 776-777 (Sup. Ct. 1963 (phrase giving irrational meaning to statute excluded); Pressman v. State Tax Commission, 204 Md. 78, 102 A. 2d 821, 827-828 (Ct. App. 1954) (phrase inadvertently retained in amended statute). See, generally, Llewellyn, The Common Law Tradition: Deciding Appeals 374 (1960); 2 Sutherland, Statutory Construction (3d ed. Horack 1943), § 4926, pp. 462-466.

While there is no doubt that under proper circumstances we may disregard words or portions of a statute, we find no New Jersey case in which an entire section of a statute, plain and unambiguous on its face, has been nullified upon the ground that it is useless and was adopted by inadvertence or mistake. However, it is unnecessary to decide now whether we should go that far for we are satisfied that plaintiff substantially complied with the underlying objectives of the 1942 legislation and that defendants are estopped from raising the defense of failure to file a section 10 notice. Parenthetically, we pause to suggest that that section and other provisions of the statute deserve prompt attention by the Legislature. See discussion in the article of Saul Tischler (now Standing Master), “Note or Bond with Mortgage — Whither the Difference,” 86 N. J. L. J. 572 (1963).

When counsel for plaintiff filed the complaint on November 16, 1966 with the Clerk of the Superior Court, he transmitted a letter to the clerk enclosing a section 10 notice directing it “to be filed in Lis Pendens Book, Hudson County.” The clerk was, of course, under no duty to send the notice to the Eegister of Hudson County. Instead, he treated it as part of the complaint and sent both to the Clerk of Middlesex County, who treated them in the same fashion.

Defendants were served with process on December 12, 1966. On December 23 defendants’ then attorney called plaintiff’s attorney and requested a 30-day extension of time in which to plead to the complaint. Plaintiff’s attorney agreed and a stipulation was filed December 30, 1966 which stated “that the time within which said defendants may Answer or otherwise move as to the Complaint herein he and the same is hereby extended for thirty days.” On January 25, 1967 defendants’ then attorney requested an extension of 20 more days. Plaintiff again assented, but the trial court granted an extension of only ten days from January 31, 1967. On February 9, 1967, almost the very last day for filing, defendants filed an answer raising ten separate defenses, and asserting a counterclaim which, in nine paragraphs, charged a conspiracy between the foreclosing first mortgagee and plaintiff whereby bidding at the foreclosure sale was stifled and plaintiff repurchased the property from the foreclosing first mortgagee, the effect being to block the creation of a surplus which otherwise would have paid or reduced plaintiff’s second mortgage.

Plaintiff’s complaint alleged, “6. Plaintiff’s action against the defendants was commenced within one year from the date of the sale of said mortgaged premises pursuant to N. J. S. A. 2A :50 — 8.”

Defendants answered, “They have insufficient knowledge or information about the allegations of paragraph 6 and leave plaintiff to its proof.” Defendants contended that paragraph 6 of the complaint did not allege compliance with section 10 of the statute but merely mentioned section 8. If compliance with section 8 is all that defendants understood from the allegations of paragraph 6 of plaintiff’s complaint, then defendants’ answer to paragraph 6 was untrue for they knew the date when the foreclosure sale had taken place (they alleged it in their counterclaim) and they knew that the date upon which they were served with the complaint was well within the year. Since it is not to be assumed that defendants intended to file an untrue answer, it may be that defendants meant to put plaintiff “to its proof” of compliance with section 10. This appears likely when we examine the first, third and seventh separate defenses, which are as follows:

“First Separate Defense
The Complaint fails to set forth a cause of action against these defendants upon which relief can be granted.
* *i' % !¡: $ $ $ $
Third Separate Defense
Plaintiff has failed to commence and prosecute the within action against these defendants pursuant to the Statutes in such case made and provided.
* * * * * i'fi *
Seventh Separate Defense
The Superior Court of New Jersey lacks jurisdiction to hear and determine the merits of the within matter.” (Emphasis ours)

With the copy of the answer and counterclaim filed on February 9, defendants served upon plaintiff a notice to take depositions on February 27 (three days after the expiration of the year limitation) and a letter saying, “Please advise what amount your client would be willing to accept in settlement of the above action and what terms would be available for the payment thereof * * *.” On February 20 plaintiff’s attorney replied that plaintiff insisted on payment in full but “with reference to any terms for payment * * * we will require statements of financial worth of both Mr. and Mrs. Julian * * Settlement discussions continued until March 1967. On March 15, 1967 present counsel were substituted and advised plaintiff’s attorney that no payment would be made by defendants because of plaintiff’s failure to file a section 10 notice.

The complaint did not allege specifically that a section 10 notice had been filed, nor did it allege “generally that all conditions precedent have been performed or have occurred.” That perhaps justified a motion by defendants for a more definite statement (R. R. 4:12-5) or a motion to dismiss for failure to state a claim upon which relief can be granted (R. R. 4:12-2(e)), but it did not excuse defendants from stating “specifically and with particularity” that they asserted as a defense the failure to file the notice. R. R. 4:9-2 provides:

“In pleading the performance or occurrence of conditions precedent, it is sufficient to aver generally that all conditions precedent have been performed or have occurred. A denial of performance or occurrence shall be made specifically and with particularity, but when so made the party pleading the performance or occurrence lias the burden of establishing it.” (Emphasis supplied)

This court declared in Hulbert v. Collins, 22 N. J. Super. 217, 219 (App. Div. 1952), “The now rules, though liberalized to promote substantial justice, nevertheless require that adverse parties be apprised of claims to be met,” citing Grobart v. Society for Establishing Useful Mfrs., 2 N. J. 136 (1949). Cf. Horby v. King, 13 N. J. Super. 395 (Law Div. 1951); R. R. 4:8-2; 4:8-5(a).

Had defendants complied with the intent and spirit of the rules, even as late as February 9 when they filed their answer, plaintiff would have had time to file a section 10 notice and a new action. Here defendants obtained extensions of time which brought plaintiff to within two weeks of the year’s limitation, and even then not only buried the defense in uninformative language in a complicated answer and counterclaim but engaged in conduct which tended to dissuade plaintiff from immediately inquiring into the meaning of the ten separate defenses, as plaintiff might have done had it not been asked about settlement and served with notice to take depositions at a time after the year was up.

If this were done deliberately by defendants to bemuse plaintiff until after the year expired, it would be indefensible. Defendants claim that their former lawyer did not know the section 10 notice had not been filed. We accept the assurance of defendants that their former attorney acted in good faith. Nevertheless, it would be inequitable to permit plaintiff to suffer and defendants to benefit from the actions of defendants’ agent which lulled plaintiff into inaction — especially when the required notice itself is meaningless and useless.

In short, defendants are estopped from raising the defense of failure to file a section 10 notice.

Plaintiff also appeals from the judgment entered in the second of the above-entitled actions. The complaint in the later case was filed on March 24, 1967, after plaintiff learned of the defect asserted by defendants with respect to the first suit. A section 10 notice was filed with the Register of Hudson County prior to the institution of the proceeding. The action was dismissed by the trial court because it had not been brought within one year from the date of the foreclosure sale, thus overruling plaintiff’s contention that defendants’ conduct in connection with the defense of the first action estopped them from relying on the one-year limitation of the statute. It is unnecessary to consider the merits of this companion appeal in view of our decision in plaintiff’s original suit.

The judgment in the first action (Docket L 816966) is reversed and the cause remanded for trial upon the remaining issues and the counterclaim.

The judgment in the second action (Docket L 2302566) is modified to provide that the dismissal shall in no wise prejudice the continued prosecution of the first action, and, as so modified, the judgment is affirmed.

Kolovsky, J. A. D.

(concurring in result). I agree that plaintiff’s failure to file a Notice of Intention to sue for a deficiency in the Office of the Register of Hudson County prior to its institution of the first action on November 16, 1966 is not fatal to the maintenance of that action.

I reach that conclusion, however, not for the reasons given in the majority opinion but because I am satisfied, for the reasons hereinafter set forth, that N. J. S. 2A :50-10 has been superseded and is no longer in effect.

If N. J. 8. 2A :50-10 is still effective, I find no basis for differing with the trial court’s conclusion that the statutory language,

“No judgment shall be entered by confession or in any action upon any such bond pursuant to section 2A:50-8 unless prior to the entry of the judgment, if by confession or prior to the commencement of the action on the bond, if the proceeding be by action, there shall be filed and recorded in the office of the clerk or register * * * [a written notice of the proposed judgment or action],”

is a bar to the entry of a judgment for plaintiff. The statutory language is mandatory not directory. Neu v. Rogge, 88 N. J. L. 335, 341 (E. & A. 1915); 3 Sutherland, Statutory Construction, § 5814 (3d ed. 1943).

The majority’s holding that defendants are estopped from raising the defense of failure to file a notice pursuant to N. J. S. 2A: 50-10 is bottomed on defendants’ alleged failure to specify that deficiency in sufficient detail in the Third and Seventh Separate Defenses of their answer. I do not agree.

If the statutory command is still effective, it matters not whether defendants’ answer adequately referred thereto, nor indeed whether defendants answered at all. Neu v. Rogge, supra, at p. 341.

Further, in my opinion, plaintiff’s proofs in opposition to defendants’ motion for summary judgment do not constitute even prima facie proof of the essential elements of an equitable estoppel, cf. Briscoe v. O’Connor, 119 N. J. Eq. 378, 384 (E. & A. 1936) ; Central R. R. Co. v. MacCartney, 68 N. J. L. 165, 175 (E. & A. 1902), and certainly do not warrant the conclusion that the facts allegedly given rise to the estoppel exist without substantial controversy so as to permit this court to find in plaintiff’s favor on that issue as a matter of law. Cf. R. R. 4:58-2,3. I do not agree that a finding of i estoppel may be based on the lack of specificity in the language of the Third and "Seventh Separate Defenses of defendants’ answer. The discovery procedures of the rules wéré" available to plaintiff.

The 'ínajority opinion suggests that the enactment of N. J. S. 2A :50-10 may have resulted from a legislative “mistake or inadvertence.” There is no evidence to support the suggestion other than' the asserted lack of purpose therein. To accept the' suggestion is to ignore the fact that in 1942, when what is now N. J. S. 2A :50-10 was enacted (L. 1942, c. 172, § 3), the Legislature had power to regulate practice and procedure. Requiring, as section 3 of the 1942 act did, the filing of a notice with the Register as a condition precedent to-the prosecution of the action and the entry of judgment was within the'legislative province. As the court said in Pennsylvania Co. for Ins., etc. v. Marcus, 89 N. J. L. 633, 638 (E. & A. 1916), with respect to the identical language found in L. 1907, c. 231, § 1 (now N. J. S. 2A :50-6) :

“We are of opinion tliat the required notice is a matter of procedure, imposing no new burdens or restrictions which materially impair the value and benefit of the bond, for it does not modify the nature or extent of the remedy any more than would a statute requiring suit to be commenced by serving a complaint containing a copy of the bond, instead of by summons without such a copy, or the filing of a Us pendens before commencing an action.”

Conjecture as to why the Legislature adopted the procedure provided in section 3 of the 1942 act (now N. J. S. 2A :50-10) serves no significant purpose; whatever the legislative purpose, the procedure mandated by it was to be followed as long as the Legislature continued to be vested with the' ‘ power to prescribe rules of practice and procedure.

If N. J. S. 2A :50-10 is still in effect, it cannot be disregarded because a court feels that its enactment was the result of mistake or inadvertence. An ambiguity in a statute may be resolved by ignoring words which appear to have been inadvertently included therein. So, too, “where a statute is ambiguous in terms and fairly susceptible of two constructions, the unreasonableness or absurdity which may follow one construction or the other may properly be considered,” 50 Am. Jur., Statutes. § 377, p. 386.

But where there is no ambiguity and the language of the statute is plain, it may not be ignored. 50 Am. Jur., Statutes, § 378, p. 390. “The wisdom of a statute is not for the courts.” Dacunzo v. Edgye, 19 N. J. 443, 454 (1955).

However, as I have indicated, I am satisfied that N. J. S. 2A :50-10 is no longer effective. It did not survive the adoption of the court rules governing practice and procedure promulgated pursuant to the Constitution of 1947. Cf. George Siegler Co. v. Norton, 8 N. J. 374, 381 (1952).

Our court rules provide the specific procedures to be followed and the steps to be taken to'recover a judgment, whether it be on a bond or on any other evidence of indebtedness, beginning with the filing of the complaint and ending with the entry of judgment, whether by default or after trial.

I have heretofore noted that section 3 of the 1942 act (now N. J. S. 2A:50-10) is wholly procedural in its operation. In my opinion such a statute, which would add an additional procedural step to those called for by the rules as a preliminary to the entry of judgment, is in conflict with the rules, is superseded thereby and is no longer effective. George Siegler Co. v. Norton, supra.

My conclusion with respect to N. J. S. 2A :50-10 in no wise impugns the continued effectiveness of N. J. S. 2A :50-6 and 7 relating to a deficiency action on a bond whose accompanying mortgage has been foreclosed. Entry of a judgment in such an action gives the judgment debtor the right for a period of six months to institute an action for redemption. N. J. S. 2A :50-4. Sections 6 and 7 are not limited in their purpose and operation, as is section 10, to providing an additional procedural step. On the contrary, as noted in the majority opinion, the main purpose of sections 6 and -7 is to effectuate the public policy for “the conservation and protection of the public records relating to the title of lands,” Neu v. Rogge, supra, at p. 340, by insuring

.“that those who have occasion to search the title to the property in question may have notice that proceedings are to be instituted or have been instituted which may result in a change in the ownership.” (O’Connor v. Briscoe, 119 N. J. L. 362, 364 (E. & A. 1938)).

Legislative regulation of the public title records is in no wise affected by the court rules; N. J. S. 2A :50-6 and 7 remain in full force and effect.


author: Carton, J. A. D.

text:
    LESTER HANDELSMAN, APPELLANT, v. DIVISION OF NEW JERSEY REAL ESTATE COMMISSION, RESPONDENT.
    Superior Court of New Jersey Appellate Division
    Argued May 20, 1968 —
    Decided June 6, 1968.

      Before Judges Goldmann, Kilkenny and Cakton.

      Mr. Leonard Adler argued the cause for appellant.

      Mr. E. Robert Levy, Deputy Attorney General, argued the cause for respondent (Mr. Arthur J. Sills, Attorney General of New Jersey, attorney).
   The opinion of the court was delivered by

Carton, J. A. D.

Lester Handelsman appeals from an order of the Division of New Jersey Real Estate Commission revoking his real estate broker’s license and directing that no license be issued to him for a period of five years. The Commission concluded that his conviction in the United States District Court for New Jersey of causing false statements to be made to the Federal Housing Administration, to which he had pleaded nolo contendere, was within the purview of N. J. S. A. 45 :15-19.1 necessitating revocation of his license.

N. J. S. A. 45:15-19.1 provides:

“When, during the term of any license issued by the commission, the licensee shall be convicted in a court of competent jurisdiction in the State of New Jersey or any Slate (including Federal courts) of forgery, embezzlement, obtaining money under false pretenses, extortion, criminal conspiracy to defraud, or other like offense or offenses and a duly certified or exemplified copy of the record in such proceedings shall be filed with the commission, the commission shall revoke forthwith the license by it theretofore issued to the licensee so convicted.”

The companion section, N. J. S. A. 45 :15-12.1, in pertinent part, provides:

“No license shall be issued by the Commission to any person known by it to have been, within five years theretofore, convicted of forgery, embezzlement, obtaining money under false pretenses, extortion, criminal conspiracy to defraud or other like offense or offenses * *

The Commission made the additional determination that appellant’s activities demonstrated conduct showing unworthiness and dishonesty, in violation of N. J. S. A. 45:15-17(e), as well as evidencing conduct constituting fraud or dishonest dealing, in violation of N. J. S. A. 45 :15-17 (1).

The facts are not in dispute. On December 19, 1965 a federal grand jury indicated appellant on a six-count indictment charging him with causing certain false statements to be made and uttered to the Federal Housing Administration and Veteran’s Home Administration in connection with applications for various mortgage loans and mortgage insurance, in violation of 18 U. S. C. A. §§ 1010, 1001 and 2. On June 23, 1967 he entered a piea of nolo contendere to the second eonnt of that indictment charging him with willfully and knowingly causing to be made to F.H.A. false statements in a commitment for insurance for the purpose of obtaining a mortgage loan upon premises in Teaneck, New Jersey. He was sentenced to prison for one year but the sentence was suspended. He was also fined $3,000 and placed on probation for two years. The Commission conducted a hearing on September 13, 1967, on the basis of which the order appealed from was issued.

The first point urged by appellant is that the Legislature invalidly delegated law-making powers to the Commission in that there are no.oadequate standards giving meaning or guidelines to thé'jjhrase “other like offense or offenses” as it appears in the statute. On the contrary, we are satisfied that the statute is valid and does not vest legislative or law-making powers in the Commission.

The presence of general terms in the statute does not of itself render it invalid. The test is whether “measured by common understanding it fairly and adequately conveys its meaning to all concerned.” Laba v. Newark Board of Education, 23 N. J. 364, 384 (1957). It is sufficiently explicit if it informs “those subject to action thereunder as to the conduct which will render them liable to its penalties.” Abelson’s Inc. v. New Jersey State Board of Optometrists, 5 N. J. 412, 424 (1950).

The design of the statute was “to create and maintain a commission to scrutinize in general and with care the character, competency, and integrity of license applicants and license holders to the end that in the interest of the public welfare, incompetent, unworthy and unscrupulous persons would be excluded from the real estate brokerage business.” Division of N. J. Real Estate Comm’n v. Ponsi, 39 N. J. Super. 526, 532-33 (App. Div. 1956). As the legislative report which accompanied the statute indicates, one of the main purposes of its enactment was the prevention or curtailment of fraudulent practices among brokers and their agents. That business is one in which great trust must be placed in the broker, and those who have a demonstrated history of fraudulent dealings are considered not desirable persons to be engaged in such business. See Ponsi, supra. Compare In re Comm’r of Banking and Insurance v. Parkwood Co., 98 N. J. Super. 263, 268 (App. Div. 1967).

The statute under consideration uses the term “like offense or offenses” in connection with a list of specified offenses : forgery, embezzlement, obtaining money under false pretenses, extortion and criminal conspiracy to defraud. The lack of any greater particularity does not render it invalid. The term “other like offense or offenses” is given specificity by reference to the crimes which the Legislature has thus grouped together. The designated offenses, although unlike in some respects, have the same common characteristic of obtaining money or property from another by means of cheating, fraud or fraudulent device. It is clear that the basis upon which the Legislature grouped these offenses together is this common element. It is a thread which runs through the fabric of each of the crimes thus enumerated. It is equally clear that the Legislature intended to include in this group any other offense in which this common element appears.

In the sections in question the only power granted to the Commission is that of finding or determining whether a conviction in a court of law for an offense described in an indictment or information is the same as the enumerated offenses already defined by statute, or whether the offense upon which the conviction is based is a like offense. The power so conferred is not a power to define or determine what the proscribed conduct should be. It is simply a power to compare a specified offense with the offenses enumerated in the statute and to determine whether a common element exists between them. The standard is the element common to the named offenses. In no fair sense can it be said, as appellant contends, that “the Commission has been delegated the legislative power to declare what shall constitute a crime.”

Attributing this meaning to the sections of the statute requiring revocation and denial of license for five years after conviction, it cannot be said that the legislative plan is unclear, that there are no proper standards, or that there has been any illegal delegation of power. There has been no denial of due process because all brokers may readily determine exactly what conduct may result in revocation.

We find no merit in appellant’s contention that his false application for E.TLA. insurance of the mortgage loan was not a like offense to the crimes enumerated in N. J. S. A. 45:15-19.1. The Commission found as facts that Lester Handelsman had been a holder of a broker’s license for a great number of years, was active in the real estate brokerage business and was well-versed in the financing of properties, especially the restrictions concerning the procurement of E.H.A. loans. The Commission’s findings refer to the charge of count two of the indictment that the statements were false and made with the intent that the mortgage loan would be insured by E.H.A. It concluded that appellant’s activities possessed the elements of obtaining money from another by means of a false device and that the conviction was for a “like offense” within the meaning of the statute. As the Commission points out, while appellant did not directly receive any of the proceeds from the mortgage loan, he did, as a result of his actions, benefit by serving his self interest and receiving a commission for the consummation of the transaction.

It is clear to us that the findings of the Commission were fully justified.

Nor is there any relevancy to appellant’s argument that the offense of which he was convicted is not a crime in New Jersey. N. J. S. A. 45 :15-19.1 does not stipulate that specific offenses committed in other jurisdictions must be offenses, in New Jersey. It requires that if the licensee shall be convicted in any court of competent jurisdiction, whether state or federal, of any of the offenses enumerated or any offense containing the elements or characteristics common to such offenses, he shall lose his license.

Appellant next argues that “a suspended sentence suspends the effect of a conviction in a collateral license revocation proceeding.” In effect, he would equate the suspension of the prison term with a pardon. This argument is fallacious.

His conviction was founded on a plea of nolo con-, tendere to the charge in the indictment. As the court said in Kravis v. Hock, 136 N. J. L. 161 (E. & A. 1947), with reference to a similar situation:

“* s » [i]t is immaterial whether that conviction is a result of a plea of guilty, or nolle contendere. The word ‘conviction’ encompasses the sentence after a plea of nolle contendere, not the plea standing alone.” (at p. 167)

The basis of the license revocation was the licensee’s unworthiness to act as a broker, as evidenced by his record of conviction. His conviction stands and it is that conviction which effects the revocation of the license for five years. Moreover, only the prison sentence was suspended. He was still required to pay a $3,000 fine and was placed on probation for two years.

Appellant’s final contention is that the Commission improperly considered the counts in the indictment which were dismissed and that he was therefore not afforded the hearing thereon to which he was entitled under N. J. S. A. 45 :15-18. This argument is based upon the Commission’s further finding that plaintiff also violated N. J. S. A. 45:15-17(e) and (1). Since the determination that appellant’s conviction is a like offense within the meaning of N. J. S. A. 45 :15-12.1 (and N. J. S. A. 45:15-19.1) mandated revocation of his license, consideration of these additional charges and the conclusion that there had been additional violations is unnecessary.

Affirmed.