author: Gelman, J. J. & D. R. C.

text:
    THE TEAGEN COMPANY, A LIMITED PARTNERSHIP, AND THE WOODFIELD COMPANY, PLAINTIFFS, v. BOROUGH OF BERGENFIELD, IN THE COUNTY OF BERGEN, A MUNICIPAL CORPORATION OF NEW JERSEY, DEFENDANT.
    Superior Court of New Jersey Law Division
    Decided May 5, 1972.

      Mr. Jerome C. Eisenberg and Mr. Raymond A. Noble for plaintiffs (Messrs. Clapp & Eisenberg, attorneys).

      Mr. Jack Geddy Goldberg for defendant {Mr. Pierce U. Dearner, Jr., attorney).
   Gelman, J. J. & D. R. C.

(temporarily assigned). In this action in lieu of prerogative writs plaintiffs challenge the validity of the practices of the Borough of Bergenfield with respect to garbage collection services provided by that municipality. They urge that the borough’s regulations, such ns they may be, invidiously discriminate against them in a manner which offends the State and Federal Constitutions.

Bergenfield is a suburban community which, in common with many others in the metropolitan area, has experienced a rapid population growth since the end of World War TI. The 19-40 census fixed its population at 10,275; by 1970 the census figure had reached 29,000. Its population is housed primarily in one-family dwellings, but tbe borough also abounds in multi-family dwellings ranging from two-family houses to apartment complexes in excess of 800 dwelling units. There are more than 1,000 multi-family dwelling units located in multi-family buildings having in excess of six units. There is no evidence in the record to establish the total number of persons living in all multi-family dwelling units in the borough, but from the figures cited above it is clear that the number of persons who do so is a significant percentage of the borough’s total population. In addition, the borough has within its borders over 400 commercial establishments and 22 industrial enterprises. See Census of Business Statistics„ 1967; New Jersey Industrial Directory, 1970.

Prior to March 1, 1949 garbage collection was accomplished by private scavenger under contract with the borough. The public bidding specifications for the contract years 1945, 1946 and 1949 have been submitted to the court and each set of specifications is identical insofar as here relevant. The scope of the work required under each was described as follows:

The work herein provided for includes the furnishing of all labor, equipment, vehicles, tools, implements, materials, and transportation facilities necessary for the collection and removal of ashes, garbage, and other refuse, more particularly described herein, from all houses, apartment houses, stores, schools, churches, buildings, premises, or properties situated within the Borough of Bergenfield, Bergen County, New Jersey.

Collections were on a twice-weekly basis., and tbe contractor was

* * * required to empty all receptacles placed between tlie sidewalks and curb, or in some relative position wlien there are no sidewalks or curbs, and when emptied the contractor shall re-place them carefully in the same place.

The borough paid the costs of the collection service directly to the contractor from general revenues raised in the usual manner.

This system was abandoned on March 1, 1949 when a municipal garbage collection system was instituted using borough employees and equipment. The expenses of collection have been and are now included in the borough’s general budget, and hence these expenses contribute to the overall tax rate borne ratably by all property owners in the borough. At the present time the borough has eight garbage trucks and 23 or 24 employees are engaged on a full-time basis in garbage collection activities.

Apparently no ordinance or resolution has ever been enacted setting forth rules, regulations or conditions under which the service is extended to borough residents and property owners. The building inspector, who also doubles as the executive assistant to the mayor and council, has been a borough employee since 1936 and testified as to the “practices” the borough has pursued with respect to garbage collection. These “practices,” as set forth in a printed card and newsletter distributed to property owners, may be summarized as follows: the borough collects any property owner’s garbage which is left at the curb in an enclosed container not exceeding 20 gallons capacity or 75 pounds in weight. Refuse is also collected, but again only if placed at the curb in containers or bundles weighing not more than 75 pounds. The town is divided into two service areas, the line of division being the railroad tracks which run north-south and bisect the town. Each side of the town has garbage and refuse collection service twice a week. The borough’s employees do not enter upon any private property to collect either garbage or refuse. Except for the container weight and size limitations, the borough’s collection procedures are substantially the same as when the service was provided by private contractors prior to 1949.

Plaintiffs are the operators of two sections of a garden apartment complex commonly known as Foster Village. The entire complex contains in excess of 600 dwelling units situated on approximately 28 acres. Plaintiffs are tenants under long-term leases of sections known as A and B, which together comprise 468 units located on approximately 23 acres. The evidence available indicates that the complex is bounded on the south by a public street known as Liberty Eoad, and that two other dedicated public streets, Howard Drive and Georgian Court, are located entirely within the complex itself. Liberty Eoad has a paved width of 36 feet, while Howard Drive and Georgian Court are 30 feet in width. There are also numerous paved parking areas throughout the complex, access to which is from the streets named above, as well as two other private streets, also located within the complex.

Foster Village was under construction at the time defendant instituted a municipal garbage collection service, and it was completed in 1950 or 1951. However, the borough has never collected garbage or refuse from any section of Foster Village. At all times since Foster Village has been in existence, garbage collection has been effected through private scavengers paid for by the various landlords who have operated and presently operate Foster Village. Between 1950 and 1969 the dweller-tenants of the complex placed their garbage in small in-the-ground receptacles located in front of their buildings. In 1968 a meeting was held between borough officials and plaintiffs’ representatives to discuss complaints concerning the unsanitary conditions existing in Foster Village arising out of this method of garbage disposal. Following this meeting, and based upon the recommendations of the borough officials, plaintiffs changed over to the system now in use. At the present time Foster Village residents place their garbage and refuse in large metal, covered containers which serve as storage bins. Bach container has a capacity of two cubic yards, and sections A and B have 26 containers located in driveways and parking lots in their areas. The containers are emptied by a private scavenger, who uses garbage trucks equipped with a hydraulic lifting device to raise the containers for this purpose. The private scavenger provides collection service six days a week throughout the complex, and the containers are filled to capacity each day. At the present time plaintiffs pay the private scavenger for this service at the rate of $13,800 per year, this rate having been established on December 1, 1971. Prior to that time the annual rate was $10,560.

It is not disputed that the borough does not have hydraulic lifting equipment on its garbage trucks to accommodate the emptying of containers such as those used by plaintiffs. It was estimated that were the garbage of plaintiffs’ tenants to be collected in the manner prescribed for municipal service, in excess of 900 and as many as 1200 garbage cans would would have to be placed at the curbs of sections A and B twice each week and that it would require one truck with three employees working one-half day for each collection.

Plaintiffs produced as an expert witness the private contractor who presently collects garbage and refuse at plaintiffs’ development. He corroborated the details of the garbage collection procedures described above. He explained that trucks equipped with a hydraulic container lifting device require only two men per vehicle rather than three men used on trucks which are not so equipped and where the collection is at curbside from cans. He operates the same type of garbage collection trucks as does the Borough of Bergenfield, and the hydraulic container lifting device, which he has added to his trucks, can be added to the borough’s trucks. He estimated the cost of installation at $1,200 per vehicle. He uses one truck with two men to collect the garbage at plaintiffs’ premises and the collection from all 26 containers requires between one and one and one-half hours for completion.

This contractor does work in several municipalities on a private contractual basis; his collection procedures include “backyard” and curbside service to one-family dwellings, as well as residential, commercial, and industrial service to customers who employ both ordinary garbage cans and large containers of the type used by plaintiffs. He expressed the opinion that the large container method is by far the most satisfactory for reasons of health and sanitation, and it is more economical to use because of the labor costs saved in collecting the garbage. However, it is impractical to collect from large containers at curbside, and where such containers are used his trucks must enter upon his customers’ properties to make the collection. He has never experienced any difficulty in carrying out collection operations on his customers’ properties.

From the foregoing recital it is evident, and I so find, that the borough never adopted any ordinance or officially promulgated any regulations prescribing the procedures and conditions for the collection of garbage and refuse since the inauguration of a municipal collection service in 1949. When the municipal service commenced in that year the prior rules in effect when the service was furnished by private scavengers were simply continued. While the absence of legislative action may not be in accordance with the legislative mandate, see N. J. S. A. 40:66-1; cf. Eckert v. West Orange, 90 N. J. L. 545, 548 (E. & A. 1917), that is not the issue here. The absence of any official imprimatur suggests only that the presumption of validity which attaches to legislative classifications or to regulations which are the product of a reasonably deliberative process is not available to defendant in this case.

The practical and inevitable consequence of the borough’s method of collecting garbage only at curbside and from small, individual containers is to deny municipal garbage collection service to large multi-family dwelling complexes such as those operated by plaintiffs. Viewed from the standpoint of public health and safety, the borough’s system is neither feasible nor desirable. The placing of between 900 and 1200 garbage cans at the curbside in a relatively densely populated and compact area such as occupied by plaintiffs’ complex would inevitably entail the spilling of garbage in and about the premises and lead to serious health and sanitation problems, not the least of which would be insect and rodent infestation. Indeed, it was precisely because of the existence of such problems when small, individual containers were in use that the borough requested plaintiffs adopt a different system of garbage storage.

The evidence establishes that the borough is in a position to furnish collection service in an efficient and sanitary manner with only a relatively minor expenditure of moneys to equip one or two trucks so as to handle the large containers presently used by plaintiffs. Actually, by reducing the number of employees required on the trucks which are so equipped, the expenses of collection of garbage in this manner would be substantially less than collection under the conditions prescribed by the borough at the present time. Further, as the borough itself argued in opposition to plaintiffs’ claim for monetary relief, it would be in a position to effect a higher tax revenue yield from plaintiffs’ properties if garbage collection services were supplied by the municipality.

By reason of the fact that the borough insists upon adhering to garbage collection procedures which are inefficient, outmoded and not reasonably calculated to accomplish the objective of protecting the public health and safely, plaintiffs are deprived of this service. In Boulevard Apartments, Inc. v. Mayor, etc. Lodi, 110 N. J. Super. 406 (1970), the Appellate Division reviewed the legislative scheme and pertinent case law dealing with municipal garbage collection and concluded that:

* * * Municipalities have wide latitude in determining the manner of control of garbage and their pertinent ordinances and resolutions, being entitled to the customary presumption of legislative validity, will not be upset unless palpably unreasonable. Dover Tp. v. Witt, 7 N. J. Super. 259, 262 (App. Div. 1950).
However, municipal legislation relating to garbage collection and disposal must be reasonable and not arbitrary or oppressive. 7 McQuillin, Municipal Corporations (rev. ed. 1968), § 24.245, at 87. Legislation limiting the collection of garbage to certain classifications is not forbidden. However, there can be no invidious discrimination in the establishment of such classifications. There is a denial of equal protection of the laws unless the service is available to all persons in like circumstances upon the same terms and conditions. Persons situated alike shall be treated alike, [at pp. 410-411]

In Boulevard the municipality supplied service through a private contractor, but the enabling ordinance expressly denied the service to privately-owned garden apartments while extending it to one-family dwellings as well as multifamily dwellings operated by the local housing authority. The Appellate Division concluded (at 411-412) that the legislative classification reflected in the ordinance was “unreasonable, discriminatory and invalid” because there is no rational basis or justification for differentiating between garden-type apartments and other residential dwellings. The court also noted that

* * * the cost of collection from family units in an apartment house where the accumulated garbage is concentrated in one spot to be picked up at the curb is unquestionably less than the cost of collection from an equal number of family units residing in separate private dwellings, [at 412]

The issue in the instant case, while cut of the same cloth, is of a different pattern. Here the municipality has what purports to be a total absence of any classification of property by type of use for garbage collection purposes but offers the service “equally” to all on the same terms and conditions. The question thus posed is whether the mere offer of an important and necessary governmental service to all upon the same terms satisfies ihe Equal Protection Clause where in actual fact the terms upon which the service is offered negate its availability to a substantial segment of the community.

Mechanical formulations of equality are not the goal. As the United States Supreme Court noted in Baker v. Carr, 369 U. S. 186, 226, 82 S. Ct. 691, 715, 7 L. Ed. 2d 663, 691 (1962) :

* * * Judicial standards under the Equal Protection Clause are well developed and familiar, and it has been open to courts since the enactment of the Fourteenth Amendment to determine, if on the particular facts they must, that a discrimination reflects no policy, but simply arbitrary and capricious action.

Following Baker v. Carr, supra, the Supreme Court in Reynolds v. Sims, 377 U. S. 533, 84 S. Ct. 1362, 12 L. Ed. 2d 506 (1964), held that legislative apportionment which accorded representation on the basis of governmental subdivisions, such as counties, but was unrelated to population, constituted a denial of equal protection. This was followed in New Jersey by Jackman v. Bodine, 43 N. J. 453 (1964), which invalidated, among other things, the provision of the New Jersey Constitution by which each county was represented by one senator in our bicameral Legislature. The New Jersey constitutional formula of one senatorial representative per county was “equal” treatment in the sense that the same representation was allotted to each such unit of government, but it did not constitute equality of representation in the exercise of the voting franchise which was deemed to be the standard required under the Equal Protection Clause.

Other analogies present themselves. Thus, the constitutional right to counsel now requires the government to assign to and pay the cost of counsel for indigent defendants so that the abstract constitutional right is equally available to all. See Gideon v. Wainwright, 372 U. S. 335, 83 S. Ct. 792, 9 L. Ed. 2d 799 (1963). Likewise, states are required to furnish transcripts to indigent defendants so that they have equal access to appellate review of' their convictions. See Griffin v. Illinois, 351 U. S. 12, 76 S. Ct. 585, 100 L. Ed. 891, reh. den. 351 U. S. 958, 76 S. Ct. 844, 100 L. Ed. 1480 (1956). Here again the concern is not with a verbal formulation of equality but the assurance that what is supposed to be equal justice is equal in fact. Ibid., 351 U. S. at 17, 76 S. Ct. 585, 100 L. Ed. at 898. The same holds true when we are concerned with the right of access to a reasonably equal public education. See Brown v. Board of Education, 347 U. S. 483, 74 S. Ct. 686, 98 L. Ed. 873 (1954) : Robinson v. Cahill, 118 N. J. Super. 223 (Law Div. 1972). In ail of the cited instances the government was compelled to expend public revenues or to undertake comprehensive programs to effectuate a constitutional mandate.

The foregoing cases may be said to deal with the denial of what are deemed to be fundamental rights of citizenship, whereas the issue here is only the availability of local municipal services as to which a measure of flexibility is both necessary and inevitable. There is ample authority for the proposition that the taxpayer status does not compel identity of treatment in this area. See, e. g., Airwick Industries, Inc. v. Carlstadt Sewerage Authority, 57 N. J. 107, 116-118 (1970). However, where no attempt has been made to arrive at a classification based on real differences to support a difference in treatment with respect to municipal services, or where the grounds upon which the classification is made are irrelevant to the achievement of the end sought, the governmental action is wholly arbitrary and must be declared such. See Walters v. St. Louis, 347 U. S. 231, 237, 74 S. Ct. 505, 98 L. Ed. 660, 665 (1954) ; N. J. Chapt., Am. I. P. v. N. J. State Board of Prof. Planners, 48 N. J. 581, 601, cert. den. 389 U. S. 8, 88 S. Ct. 70, 19 L. Ed. 2d 8 (1967); Boulevard Apartments, Inc. v. Mayor, etc., Lodi, supra.

The New Jersey Legislature and our courts have long recognized that the collection and control of garbage are indispensable to the public health and safety. See Earruso v. Board of Health, East Hanover Tp., 120 N. J. L. 463, 469 (Sup. Ct. 1938); 7 McQuillin, Municipal Corporations, § 24.250, at 94. In 1970 the Legislature adopted the Solid Waste Utility Control Act, N. J. S. A. 48:13A-1 et seq., and stated in section 2:

The Legislature finds and declares that the collection, disposal and utilization of solid waste is a matter of grave concern to all citizens and is an activity thoroughly affected with the public interest; that the health, safety and welfare of the people of this State require efficient and reasonable solid waste collection, disposal and utilization service * *.

In the face of this strong statement of the State’s public policy, it is incumbent upon local government to utilize the most effective means of carrying out within its area of responsibility the legislative mandate. Where the means are readily available at a reasonable or, as here, a lesser expense to collect garbage in an efficient and more sanitary manner from large residential projects such as plaintiffs’, the municipality cannot claim that it has made a good-faith effort to make this essential service available on a substantially equal basis by adhering to practices which are unrelated to and wholly arbitrary in view of the objective to be fulfilled. See Reynolds v. Sims, supra, 377 U. S. at 577, 84 S. Ct. 1362, 12 L. Ed. 2d at 536; Reid Development Corp. v. Parsippany-Troy Hills Tp., 10 N. J. 229, 234 (1952); cf. In re Regulaiion F-22, Office of Milk Industry, New Jersey, 30 N. J. 335, 343 (1959).

The holding in this case, therefore, is that the borough shall henceforth be required to collect garbage at plaintiffs’ premises and to take such action as may be necessary or appropriate to effect such collection from containers used by plaintiffs for the storage of garbage at the present time. Further, the borough shall amend its practices or regulations so as to authorize borough trucks to enter plaintiffs’ premises for this purpose, provided that plaintiffs shall agree to indemnify and save the borough harmless from any claims arising out of such use of their premises by the municipal vehicles involved. Nothing in the evidence adduced by plaintiffs suggests that the borough’s practice of collecting garbage on a twice-weekly basis is either unreasonable or arbitrary, and the municipal collection services shall be furnished to plaintiffs’ premises with the same frequency as made available to all other property owners.

Plaintiffs’ claim for monetary relief will be dismissed. There is nothing in the record to show that they made any formal demand for garbage collection services from the borough prior to the institution of this action. As major taxpayers in this municipality, plaintiffs are charged with knowledge of the borough’s garbage collection practices, and they obviously knew that they were not receiving this service. Nevertheless, in all of the years during which they had an interest in this matter, they never made a written demand upon the municipality that the service be extended to them. At most, there was a casual conversation or statement made at the meeting in 1968 concerning this subject, and this was never pursued in any formal manner until this action was brought. Plaintiffs always had available to them recourse to the courts to seek redress for their grievances, and even where the rights infringed are of a constitutional dimension, those aggrieved are barred from monetary relief where they have neither acted timely nor in an appropriate manner, which certainly was the ease here. See Suburban Dept. Stores v. East Orange, 47 N. J. Super. 472, 480 (App. Div. 1957); cf. Myers v. Cedar Grove Tp., 66 N. J. Super. 530, 546 (App. Div.), rev’d on other grounds 36 N. J. 51 (1961); Jones v. Zoning Bd. of Adjust., Long Beach Tp., 28 N. J. Super. 483 (Law Div. 1953); Manobianco v. Hoboken, 96 N. J. Super. 273 (Law Div. 1967).

      The current municipal budget (excluding school costs) is $3,529,636.52.


source: Caselaw Access Project

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

license: Public Domain

text:
    LILLIE SACHS, EXECUTOR OF THE ESTATE OF IRVING SACHS, PLAINTIFF, v. COMMERCIAL INSURANCE CO. OF NEWARK, NEW JERSEY, A NEW JERSEY CORPORATION, DEFENDANT.
    Superior Court of New Jersey Law Division
    Decided May 12, 1972.

      Mr. Frank 8. Wexler for plaintiff (Messrs. Wexler and Guida, attorneys).

      Mr. Floyd F. Lombardi for defendant (Messrs. LeSevo, Cerutti and Lombardi, attorneys).
   Larner, A. J. S. C.

Plaintiff brings this action as executrix of her late husband’s estate, seeking reimbursement for certain medical expenses incurred during his last illness. The action is founded upon the contractual provision of a major medical expense policy issued by defendant to the decedent in connection with a group plan for members of the New Jersey Bar Association.

The first policy issued to Irving Sachs was dated November 1, 1964 and designated as GMC 4007. In 1966 the assured filed a claim under that policy for hospital and medical expenses incurred in connection with examinations, consultations and treatment commencing February 1966, necessitated by complaints of blackouts and general weakness of the upper extremities. Included in this treatment was a confinement to Poliak Hospital in Jersey City from February 14 to 24, 1966. The hospital report reflects a history of lightheadedness and syncope, with the first episode occurring in November 1964 and another similar episode in November 1965. Subsequently, the episodes were more frequent without any particular timing or pattern of onset. The consultation report of Dr. Winokur, a neurosurgeon, diagnosed the condition in February 1966 as amyotrophic lateral sclerosis and arteriosclerotic brain disease with intermittent attacks of thrombosis of minor intercranial vessels. Another neurologist, Dr. Valergalds, stated his opinion that the patient’s attacks were due to “some disturbance in the heart,” and he suggested an EKG. Such an EKG, however, demonstrated no abnormality. In addition to the foregoing diagnoses, the patient was a long standing diabetic suffering from diabetes mellitis which was under control at the time.

I find from an examination of the record of Poliak Hospital and the testimony of Dr. Medinots that prior to February 1966 the assured was suffering from cerebral arteriosclerosis and had active symptomology attributable to that disease, and that his diabetic condition was not causally related to his symptoms or his treatment at that time. I further find that the arteriosclerosis is progressive in nature and that the patient continued to deteriorate with more severe symptoms involving his brain and the functions of the brain as time went on.

It was because of this single syndrome that he required not only the hospitalization and treatment in 1966, but also the hospitalization in Fair Oaks from January 25, 1968 to March 28, 1968 and the subsequent hospitalization in Jewish Hospital from March 28, 1968 to the time of his death in March 1970.

The records are replete with evidence of a gradual deterioration of the patient’s intellectual and mental powers, at least since 1964, with loss of memory and other symptoms characteristic of cerebral arteriosclerosis. I therefore reject as a fact plaintiff’s contention that the cerebral arteriosclerosis was a new disease commencing in 1968.

The significance of this finding lies in the determination of the period of coverage for which defendant would be liable under the aforesaid policy which limits payments to expenses incurred within two years from the date such expense first began. Defendant did pay for all covered expenses from February 1966 to February 1968 and contends that its obligation is at an end. In the absence of the problems raised by the issuance of a second policy in 1967, the position of defendant would be valid and sustained.

However, the issue is complicated by virtue of certain modifications of the insurance contract undertaken by the company in 1967. Sometime prior to November 1, 1967 the company, through its agent John A. Couch, Jr. & Co., notified all its assureds who were part of the .Bar Association plan that because of poor experience it was modifying the terms of the policies with changes in coverages and benefits. On one hand this involved an increase in premiums and a larger deductible interest. On the plus side for assureds, the maximum benefit was increased from $10,000 to $12,500 and the benefit period extended from two to three years.

A letter from the agent was distributed to the assureds which explained the new benefits effective November 1, 1967 and referred to the new provisions as “modifications” and “liberalizations,” with several indications that the existing plan was being modified. This represented a sales pitch to encourage the assureds to remain in the program.

It was pursuant to this new plan for the enrolled members of the Association that defendant, subsequent to the “Dear Policyholder” letter, issued a replacement policy No. G-MR 1813, effective November 1, 1967, which contained, among other modifications, a provision that covered expenses would be paid for a maximum period during three consecutive policy years.

Plaintiff asserts that the 1967 policy is in reality an amendment of the original policy and that she is therefore entitled to coverage by way of payment for the medical expenses incurred beyond the termination date of the first policy to a point three years after the commencement of treatment of the illness or disease involved. Since I have ruled that the expenses beyond 1967 are part and parcel of the treatment for the disease which commenced in February- 1966, it would be plaintiffs contention that she is entitled to reimbursement for expenses until February 1969. And since payment was made to February 1968, she seeks recovery on this theory for expenses incurred -for an additional year between 1968 and 1969.

Defendant counters that it performed its full obligation under the 1964 policy by payment of expenses incurred for two years, which period extended beyond the termination date of the earlier policy; and that a claim can only arise under the three-year plan of the new policy if it involves sickness or disease arising anew during the term of the new policy.

The issue, therefore, is whether the rights of the parties should be measured solely by the provisions of the new policy, without reference back to the existence of the old policy, or whether the two policies should be considered together as a continuous contract, with amendments benefiting the assured to be applied to an illness which predated the new policy.

It is fundamental that in the ease of any ambiguity in a policy of insurance, the construction favoring the assured should be applied by the court. Ohio Cas. Ins. Co. v. Flanagin, 44 N. J. 504, 513-514 (1965); Sandler v. N. J. Realty Title Ins. Co., 36 N. J. 471, 479 (1962) ; Hunt v. Hospital Service Plan of N. J., 33 N. J. 98, 102-103 (1960); National Union Fire Ins. Co. of Pittsburg, Pennsylvania v. Falciani, 87 N. J. Super. 157, 167 (App. Div. 1965). As a corollary, a policy should be interpreted from the viewpoint of the reasonable expectations of the purchasing public Kievit v. Loyal Protective Life Ins Co., 34 N. J. 475, 482 (1961), and should be construed liberally in their favor “to the end that coverage is afforded To the full extent that any fair interpretation will allow' ” Danek v. Hommer, 28 N. J. Super. 68, 76 (App. Div. 1953), aff’d 15 N. J. 573 (1954). See Schneider v. New Amsterdam Cas. Co., 22 N. J. Super. 238, 242 (App. Div. 1952); Mahon v. American Cas. Co. of Reading, 65 N. J. Super. 148, 165 (App. Div. 1961); cf. Dittmar v. Continental Cas. Co., 29 N. J. 532, 542 (1959) ; Yannuzzi v. United States Casualty Co., 19 N. J. 201, 207 (1955). See also, Matits v. Nationwide Mutual Ins. Co., 33 N. J. 488, 495 (1960); Indemnity Ins. Co., etc. v. Metropolitan Cas. Ins. Co. of New York, 33 N. J. 507, 512 (1960).

The letter distributed by the agent is as binding upon the company as the formal policies themselves. The manner in which the new policy came into being, when taken together with the agent’s representations, should result in a construction of the two policies and the letter as an integrated whole.

Pair dealing dictates that the decedent and all other assureds in the plan reasonably expected that their existing policies were continuing as heretofore, with the “modifications” and “liberalizations” representing amendments to the existing policies. The fact that the company utilized the. form of a new instrument does not in itself detract from this construction, which accords with a layman’s expectations from the nature of the transaction and the language utilized by the company and its agent. It wuold have required but a few clear words to inform the policyholders that the additional benefits under the new policy would not apply to the payment of claims which overlapped from one policy period to the other. Yet the letter is silent on that score.

The foregoing conclusion is further buttressed by the following undertaking contained in the letter from the agent:

7. Your replacement policy will include the standard Policy Provision regarding “Time Limit on Certain Defenses.” However, the Company has further agreed that the portion of this Provision referring to “two years from the date of issue of this policy” shall mean “two years from the date of issue of the policy being replaced.” All new policies will bear a stamp to the effect that the new policy is replacing a prior contract of insurance and will state the number of such policy.

This latter provision represents an indication of the nexns between the two policies, so that contestability for a pre-existing disease or nonfraudulent misstatement was barred two years from the date of issuance of the first policy and not the second, despite the issuance of a new contract. Such a concession supports the construction that the assured could reasonably anticipate that his enrollment in the new plan by the payment of the additional premium would entitle him to the new benefits as to continuing treatment for a disease commencing during the term of the earlier policy. The additional benefits thus related back as an amendment to that earlier policy to apply to existing continuing claims, in the absence of a clear provision to the contrary.

This determination is particularly warranted because the policy was issued under a group plan which was attuned to the underlying motive of the company to continue the coverage for the group with the proposed changes. Each assured had the security of a noncan cell able policy except for conditions which did not apply to the decedent herein. Consequently, the unilateral amendment of a policy which could not be cancelled by the company adds to the totality of factors which would lead the assureds to conclude that the coverage was a continuing one, rather than the initiation of a new relationship under a new contract.

One further issue remains for determination. Both policies contain a clause limiting the amount payable for mental disorders accompanied by hospitalization to a maximum of $2,000. The earlier policj uses the term “mental illness”; the later policy uses the terms “mental or nervous illness, disorder or emotional disturbance.” Does cither limitation apply to the disease of the decedent diagnosed as cerebral arteriosclerosis and amyotrophic lateral sclerosis?

I conclude that under the clause of either policy, the limitation was intended to apply only to purely mental disorders involving functional etiology, and not to mental symptomology produced by organic disease. In this case the affliction involved a physical deterioration and blockage of the vessels in the brain because of sclerosis. The illness or disorder was thus the arteriosclerosis; the mental and intellectual deterioration was but the end result thereof. See Mutual Benefit Health & Accident Ass’n v. Rowell, 236 Ark. 771, 368 S. W. 2d 272 (Sup. Ct. 1963), and 98 A. L. R. 2d 277, 284.

It is reasonable to assume that the limitation was intended to delimit claims in cases of insanity or other degrees of mental aberration which are functional in origin. The public would not expect that such a limitation would control merely because the end result of an organic disease may affect the mental function of the individual. See Gareis v. Benefit Ass’n of Railway Emp. Ins. Co., 284 Minn. 262, 169 N. W. 2d 730 (Sup. Ct. 1969); Prince v. United States Life Ins. Co., 42 Misc. 2d 410, 248 N. Y. S. 2d 336 (Sup. Ct. 1964), aff'd 23 A. D. 2d 723, 257 N. Y. S. 2d 891 (App. Div. 1965), aff'd 17 N. Y. 2d 742, 270 N. Y. S. 2d 209, 217 N. E. 2d 33 (Ct. App. 1966). In any event, the policy language is sufficiently obscure to construe the same liberally in favor of the assured and against the company.

In view of the foregoing, judgment will be entered in favor of the plaintiff for all covered expenses incurred between February 1968 and February 1969. Counsel should be able to stipulate the amount involved and submit a consent order accordingly.


author: Toscano, J. C. C.

text:
    HERBERT H. DANIEL ET AL., PLAINTIFFS, v. BOROUGH OF OAKLAND, DEFENDANT.
    Superior Court of New Jersey Law Division
    Decided May 10, 1972.

      Messrs. Losche & Losche, attorneys for plaintiffs.

      Mr. William DeLorenzo, Jr., attorney for defendant.
   Toscano, J. C. C.

(temporarily assigned). Plaintiffs, residents of the Borough of Oakland, filed a complaint in lieu of prerogative writs as consumers of water from the borough and as representatives of all the consumers of water in the borough, challenging the validity of an ordinance dated September 10, 1970 which increased the water charges retroactively to cover a period from July 1 to September 10, 1970. They allege that the ordinance is illegal, violates the constitution and laws of Now Jersey and also impairs the constitutional provision on contracts.

The facts disclose that the borough operates its own water utility on a self-liquidating basis. Due to an increase in the costs of operation during the early part of 1970, the borough officials became aware of a need for an increase in the rates charged for water. The public was made aware of this at various meetings in the early part of the year and of the fact that such an increase would be made necessary unless water revenues increased. The mayor and council held off introducing of the ordinance in hope of anticipated increase in revenues. This did not materialize. As a result, the ordinance was adopted in September 1970 and expressly made effective as of July 1, 1970.

Plaintiffs seek a return of monies to the residents of the borough using water during the period from July 1 until the effective date of the ordinance in 1970, claiming that it was unlawful to have a retroactive date for a rate increase. There is approximately $4,000 in monies that would have to be returned, and based upon the number of water users, this would amount to $1 a family. The result of being required to return-the monies would necessitate the inclusion of an additional amount in the municipal budget for 1971. In addition, a deficit would be created under the law and would affect the bonding capacity of the borough.

The argument advanced by plaintiffs is that the retrospective application of the ordinance would impair contractual obligations and divest vested rights. Consequently, the ordinance as applied contravenes the Constitution of the United States. See Gilman v. Newark, 73 N. J. Super. 562, 598 (Law Div. 1962).

The Borough adopted the ordinance under the statutory authority of N. J. S. A. 40 :62-77:

Tlie governing body * “ * may make * * * all such ordinances * * * as it may deem necessary and proper * * * for fixing and collecting the water rents or prices for water * * *.

The statute is silent as to retroactive ordinances, but in 1928 the Chancery Court explained that this provision:

* * * grants no power to Bayonne to make retroactive water rates, but only the power to fix and collect the water rents and prices established in advance for the service to be rendered. [Federal Shipbuilding & Co. v. Bayonne, 102 N. J. Eq. 475, 480 (1928)]

The court referred to Jones v. Bloomfield, 69 A. 1106 (N. J. Ch. 1908), to support this statutory construction. Both the factual and legal situations in Jones were not on all fours with that before the Chancery Court in 1928. In Jones a municipal ordinance established fiat rates for water charges and reserved the right of the municipality to set meters and charge accordingly. Bloomfield did set up water meters, but it failed to notify the consumers to that effect, and mistakenly billed the consumers pursuant to the flat rate charge. The court concerned itself solely with the interpretation of the ordinance, and concluded that merely setting the meters without adequately notifying the consumers was not an effectual election of the reserved right to change from the flat rate. The fact that the failure to notify was the result of a mistake in billing did not give Bloomfield the legal right to collect the difference between the flat rate and the meter rate.

The situation in Federal Shipbuilding & Co. v. Bayonne, supra, was that the municipality entered express contracts, with stipulated rates, to supply water to a certain company. Later, a resolution was passed, increasing the rate to be paid by the company for all water theretofore furnished as well as for water thereafter furnished. The court found that the resolution destroyed the rights vested in the company by the written contracts, and that the statutory authority quoted above did not grant to the municipality power to make any retroactive resolutions.

The statutory provision in effect in 1938 is almost identical to that applicable to the case at bar. However, there has been a drastic change in the underlying state constitutional principles. The New Jersey Constitution of 1947 now in effect directs that laws concerning municipalities be liberally construed in their favor, Art. IV, § VII, par. 11. On the other hand, the Constitution of 1884, effective in 1938, contained no such directive. The court in Union Cty. Bd. of Chosen Freeholders v. Union Cty. Park Comm'n, 41 N. J. 333 (1964), had declared that the 1948 Constitution

* * * was intended to obviate earlier judicial decisions which had taken the position that grants of power by the Legislature to its political subdivisions should be construed narrowly and that doubt as to the existence of any asserted power should lead to its denial, [at 339]

Since neither the New Jersey Constitution nor the United States Constitution prohibit the enactment of retroactive legislation by a municipal government, the power to enact such can be read into N. J. S. A. 40:62-77 whenever the power is necessarily or fairly implied by, or incidental or essential to, the powers expressly conferred by that statute, as long as the exercise of the power is not prohibited by either the New Jersey Constitution or law, N. J. Constitution (1947) Art. IV, § VII, par. 11.

Plaintiffs’ contention is that the receipt oí water from July 1 to September 2, 1970, under the then existing ordinance, gives them a vested right in, or a contract obligation to pay, the water rates established by that ordinance. Any legislation affecting the water rates for that period impairs such right or obligation, and is therefore prohibited by the Constitution and law. This Court cannot accept plaintiffs’ conclusion because it finds their basic premise untenable.

The matter of charges for water furnished by a municipality has been considered as a subject of contract rather than being classified as a tax, for the purpose of resolving particular issues; e. g., the sufficient certainty of such charges in order to permit the enforcement of payment thereof, Lehigh Valley R. R. Co. v. Jersey City, 103 N. J. L. 574, 576 (Sup. Ct. 1927); the liability of the landowner for water used by a third party, Jersey City v. Morris Canal and Banking Co., 41 N. J. L. 66 (Sup. Ct. 1879), and the liability of the landlord’s estate for a lien for water supplied to a tenant, Ford Motor Co. v. Kearny, 91 N. J. L. 671 (E. & A. 1917). The proprietary character of a public water utility has been determined with respect to the issues of municipal immunity in tort, Cloyes v. Delaware Tp., 23 N. J. 324 (1957); a municipality’s right to sell lands constituting a water reserve, East Orange v. Bd. of Water Com’rs, East Orange, 73 N. J. Super. 440 (Law Div. 1962), and a municipality’s duty to supply water to all of its inhabitants, Reid Development Corp. v. Parsippany-Troy Hills Tp., 10 N. J. 229 (1952).

The instant issue of whether a water rate fixed by an ordinance should be treated as a subject of contract, to the extent that such rate cannot be changed after the water has been supplied, has never been resolved by the Courts. The considerations in the above cited cases that led to the findings of contract and proprietary function are not entirely water utility managed by a municipality cannot be treated applicable to the case at hand. In other words, a public water utility managed by a municipality cannot be treated the same as a private corporation in all instances. See Reid, supra.

Defendant has pointed out that all taxpayers of the borough, whether or not they are consumers of water, are owners of the borough’s water utility. It is important to the taxpayers that the utility be operated on a self-sustaining basis so that it need not be subsidized by general taxation. The particular concern of the consumers is that the service always be available and sufficient to satisfy their requirements. The consumers and other taxpayers are in no position to bargain for the amount of water charges, because their elected representatives are the ones who fix the rates. Since the electorate and their representatives are, theoretically, of one mind, there can be no meeting of the minds in the purely contract sense in relation to the amount of water charges.

In light of the preceding analysis, this court finds that in the peculiar factual situation at hand there is no contract obligation to pay a rate fixed in advance. Nor does this court find that plaintiffs acquired any vested rights under the initial ordinance. The concept of “vested rights” has been described as

* * * a present fixed interest which in right reason and natural justice should be protected against arbitrary state action—and innately just and imperative right that an enlightened free society, sensitive to inherent and irrefragable individual rights, cannot deny, [Pennsylvania Greyhound Lines, Inc. v. Rosenthal, 14 N. J. 372, 384—385 (1954)]

It is the opinion of this court that any interest plaintiffs may have had under the initial ordinance does not rise to the level of that described above. The area of fixing water rates is one in which a municipality should be permitted some latitude of discretion. The court in Reid Development Corp. v. Parsippany-Troy Hills Tp., 10 N. J. 229 (1952), recognized that a municipality can exercise discretionary authority when providing water for the public and private uses, and can .impose conditions reasonably bearing on the exercise of this function.

The two-month retroactivity of the ordinance amendment in question bears a reasonable relation to the function of fixing appropriate water rates. By reason of this retrospective effectiveness the incidence of the increase in rates falls upon those who consumed water during that period of time in which the loss in revenues was incurred. It is evident, then, that the exercise of the authority to enact retroactive ordinances was not arbitrary or illegal in the case at bar. Seeing that nono of the plaintiffs have asserted the standing of a new homeowner, who relied on a water bill issued under the original ordinance when closing title and has since been charged with the increased rate for a period during which the previous owner received the water, it will not be necessary to decide if such an individual is entitled to a credit for the increase.

For the foregoing reasons, judgment is entered for defendant and the complaint dismissed.


author: Per Curiam.

text:
    CAROL J. BARTELL, PLAINTIFF, AND WILLIAM E. BARTELL, PLAINTIFF-RESPONDENT, v. ANTHONY J. RAZZANO AND KRAMER TRUCKING COMPANY, INC., DEFENDANTS-APPELLANTS. AND ANTHONY J. RAZZANO, THIRD PARTY PLAINTIFF, v. MICHAEL TORTORELLO, THIRD PARTY DEFENDANT.
    Superior Court of New Jersey Appellate Division
    Argued November 15, 1971
    Decided May 17, 1972.

      Before Judges Coneoed, Matthews and Feitz.

      Mr. Amos O. Saunders argued the cause for appellant Kramer Trucking Company, Inc. (Mr. Aaron Dines, of counsel and on the brief; Messrs. Ddbrin, Muscarella <& Saunders, attorneys).

      Mr. J. Nolle Sellarole, attorney for appellant Anthony J. Razzano, filed a statement in lieu of brief.

      Mr. Peter A. Benz argued the cause for respondent William E. Bartell.

      Mr. Allen O. Mathias argued the cause for third-party defendant (Mr. George A. Price, of counsel and on the brief; Messrs. Stevens & Mathias, attorneys).
   Per Curiam.

Defendant Kramer Trucking Co., Inc. appeals on several grounds from a judgment on a jury verdict in favor of plaintiff in a motor vehicle negligence action. We affirm.

Defendant urges as a ground for appeal error in the admission of a doctor’s testimony relating to his interpretation of certain X-rays. Defendant’s position is that such testimony should not be admitted without a prior introduction of the X-rays in evidence. It would appear that the precise question has not heretofore been determined by an appellate court in New Jersey. Stiles v. MacLean, 103 N. J. L. 537 (Sup. Ct. 1927), in which the X-ray plates in question had been lost, avoided a determination in finding that there was “not the slightest suggestion that the witness placed any reliance on the X-ray plates except to confirm his diagnosis made independently thereof, * * Lack of specificity in the objection mooted the issue in Paparazzo v. Perkel, 16 N. J. Super. 128 (App. Div. 1951). The argument here is forwarded on the basis of the so-called best evidence rule, Evidence Rule 70. We doubt that X-ray plates are a “writing” within the purview of that rule. Unlike a will or a contract, an X-ray plate most probably has little meaning for a lay jury except in the context of a properly qualified expression of expert opinion. It seems to us that the nature of the X-ray plate and its proper position in the trial of a medical issue is entirely dependent upon a testimonial process far outside the contemplation of Evidence Rule 70.

Beyond this consideration, we see no reason why a properly qualified doctor should be denied expression of an opinion with regard to his interpretation of X-rays without introduction of the X-rays in evidence.

Obviously, this pragmatic recognition of the nature of X-rays, including, as aforementioned, the likely unintelligibility to a lay jury without expert interpretation, requires some safeguards. Despite our acknowledgment that there are other jurisdictions which have adopted a rule contrary to that which we here enunciate, we are of the opinion that the better rule is that stated by Wigmore:

In view of this importance of [X-ray] interpretation, a witness who testifies orally to knowledge obtained by studying an X-ray photograph must be prepared to produce the photograph-print (and the original plates also, if desired) for cross-examination to the grounds of his interpretation. [3 Wigmore, Evidence § 795, at 246 (Chadbourn rev. 1970) ; emphasis is the author’s]

We hold that properly qualified opinion testimony predicated in whole or in part upon observation of X-rays is not inherently inadmissible by virtue of the failure of the party to introduce the X-rays in evidence or, absent demand, to produce them at the time of testimony. We recognize, as does Wigmore, that, unless there are other considerations not presently before us and concerning which we here express no opinion, fairness and the constant search of the court for the truth require that the proponent of such testimony be prepared to produce the X-rays for cross-examination upon demand. Such a requirement will effectively insure the opportunity for adequate cross-examination and provide for the opponent an availability of the X-rays to be offered in evidence if that course appears advisable to him.

In the instant matter, there was no demand. There was simply an objection on the basis of the X-rays neither being offered nor in court. The witness proffered a perfectly reasonable explanation for the absence of the X-rays, testifying that he had come to court directly from the hospital and simply did not have the X-rays with him. Even then there was no demand from defendants for their production, although it appears that defendants knew or should have known from pretrial discovery of the witness’ reliance on X-rays which had been taken. Accordingly, we find no error in the admission here of the impugned testimony.

Denial of defendant’s motion for judgment at the end of plaintiff’s case was not error. The motion was based on a purported lack of evidence of agency between the trucking company defendant, owner of the trailer, and the driver who also owned the tractor. While a reasonable argument is made to the effect that the fact of a written contract here between the driver and the trucking company brings the matter within the purview of Cox v. Bond Transportation, Inc., 53 N. J. 186 (1969), cert. den. 395 U. S. 935, 89 S. Ct. 1999, 23 L. Ed. 2d 450 (1969), we do not reach that point and express no opinion thereon. The fact is that the trucking company had leased the tractor from its owner by written instrument. In these circumstances, as in cases where one other than the owner is driving a car (Harvey v. Craw, 110 N. J. Super. 68, 73 (App. Div. 1970), certif. den. 56 N. J. 479 (1970)), a presumption arises that the driver is operating the vehicle as the agent of such lessee. When that presumption is unrebutted, as here, a jury question is presented.

The insistence of the trial judge that the trial commence as scheduled was not error. The granting of an adjournment is within the sound discretion of the trial court. Stott v. Greengos, 95 N. J. Super. 96, 100 (App. Div. 1967). The trial court’s refusal here to grant a motion for adjournment was not in our view a mistaken exercise of discretion in all the circumstances of this particular case.

We have considered appellant’s arguments criticizing the charge, complaining of excessiveness in the verdict, and challenging the trial court’s action in denying defendant’s motion for a new trial, and find these to be without merit.

Affirmed.


text:
    CHRISTOPHER F. COOKE, SR., AND REBA COOKE, HIS WIFE, PLAINTIFFS-RESPONDENTS, v. FIREMEN’S INSURANCE CO. OF NEWARK, N. J., A NEW JERSEY CORPORATION, DEFENDANT-APPELLANT.
    Superior Court of New Jersey Appellate Division
    Argued April 10, 1972
    Decided May 17, 1972.

      Before Judges Collesteb, Mintz and Lynch.

      Mr. William B. McGwire argued the cause for appellant (Messrs. Bum, Biunno & Tomphins, attorneys; Mr. William F. Dowd, on the brief).

      Mr. Norman Bruch argued the cause for respondents.
   Per Curiam.

Defendant appeals from a judgment entered in favor of plaintiffs on January 25, 1971 for $10,094.45. The judgment is comprised of the sum of $7,938, the stipulated amount of the fire loss involved, plus interest thereon at 6%.

The trial judge granted plaintiffs’ motion for judgment at the close of all the evidence upon a finding that a contract had been entered into between plaintiff Christopher P. Cooke, Sr., as purchaser, and the devisees and their respective spouses of the late Ella Rosenberg, as sellers, of a two-family dwelling in Newark.

The parties stipulated that defendant issued a fire insurance policy to plaintiff Christopher P. Cooke, Sr. for a three-year period commencing January 18, 1966, and that a fire loss occurred in the subject premises in the sum of $7,938, as earlier noted.

Louis Rosenberg was in the tailoring business. Cooke, who was in a similar business, agreed to make $1,000 worth of coats, for Louis Rosenberg in payment for his interest in the property. It also appears that shortly after the execution of the contract plaintiffs took possession, made repairs to the property, paid an outstanding water bill, all of which aggregated $753.70, and rented the premises to others. They also paid the first installment premium on the insurance policy of $36 out of a total of $93. At the time of the fire the policy of insurance in the face amount of $10,000 was in full force and effect.

There were certain title impediments, and apparently a caveat lodged against the probating of the will of Ella Rosenberg by a daughter, Pauline Peldstein. The will was ultimately admitted to probate, but the title problems had not yet been resolved on the date of the fire.

The insurance policy in question was issued pursuant to N. J. S. A. 17:36-5.19, which in part provides:

Every such fire insurance policy shall insure, limited to the amounts of insurance specified therein, the named insured and legal representatives, to the extent of the actual cash value of the property at the time of loss, but not exceeding the amount which it would cost to repair or replace the property * * * nor in any event for more than the interest of the insured, against all direct loss by fire * * *. (Emphasis added).

Defendant argues that plaintiffs lacked legal title. Plaintiffs expended a maximum of $1,753.70 toward the purchase and repair of the premises. Defendant contends that in these circumstances plaintiffs should not be permitted to recover the claimed loss of $7,938 but rather only their financial interest in the property, which at most amounted to $1,753.70. It asserts that a contract for insurance against fire is ordinarily one of indemnity, and as such entitles the insured only to his actual pecuniary loss.

Concededly, plaintiffs had an insurable interest in the property. In our judgment, the cited statutory language which we have emphasized apparently applies to cases in which the interest of the named insured is of a limited nature, such as a secured creditor, mortgagee, pledgee, or other security interest in the insured property which is terminated by the payment of the debt. Cf. Flint Frozen Foods, Inc. v. Fireman’s Ins. Co. of N. J., 8 N. J. 606, 610 (1952), where recovery was denied on an assigned fire claim for goods held as collateral security after the creditor insured had been fully paid by his debtor. Since the debt had been paid, the court found no loss requiring indemnificaton. See also, Hyman v. Sun Ins. Co., 70 N. J. Super. 96 (App. Div. 1961).

Clearly, plaintiffs by virtue of the contract held equitable ownership of the property in addition to possession. Coolidge & Sickler, Inc. v. Regn, 7 N. J. 93, 98 (1951).

Neither counsels’ nor our independent research has disclosed any decisional authority in this State construing the statutory limitation in N. J. S. A. 17:36-5.19, “nor in any event for more than the interest of the insured, against all direct loss by fire,” in the context here presented.

In Wolf v. Home Ins. Co., 100 N. J. Super. 27 (Law Div. 1968), aff’d o. b. 103 N. J. Super. 357 (App. Div. 1968), the insured-owner prior to the time of the fire had agreed in lieu of condemnation proceedings to sell the insured property to the State. The property had been vacated and possession taken by the State. The sale was actually consummated nearly five months after the fire, with the insured receiving the full contract price previously agreed upon. Nevertheless, the court permitted recovery of the fire loss by the vendor on the theory that the “time of loss” must mean the time of fire damage or destruction, and in the course of opinion stated (at 44) : If any other meaning were inferred, then the time for valuing the loss would be uncertain in every case.

The court further stated:

The insurer is not being damaged by being compelled to pay the insured who is owner as of the date of the fire. Its premiums are assumed to represent the fair equivalent of the obligation it contracted to incur without knowledge of the existence of collateral remedies. Board of Trustees, etc. v. Cream City Mutual Ins. Co., 255 Minn. 347, 96 N. W. 2d 690, 696 (Sup. Ct. 1959). And the evil of the chance possibility of an ultimate collection by the vendor of the full purchase price from his vendee and also the insurance payment for the damage sustained does not outweigh the disruptions and harassments closely associated with delays in settlement of fire loss claims. Cf. Springfield Fire and Marine Ins. Co. v. Boswell, 167 So. 2d 780, 785 (Fla. District Ct. of App 1964). [at 49]

The instant case is distinguishable from Wolf in that here the insured is the purchaser under contract at the time of the fire. But the rationale of Wolf is equally apposite.

The concurring Appellate Division opinion by Judge Carton in Wolf (at 358-359) pointedly indicates that at the time the contract of sale was entered into, the insurance company would have issued an endorsement covering the purchaser’s interest without the payment of any additional premium. So here, an endorsement would have issued upon request covering the interest of the vendors without the payment of any additional premium. He further stated:

In essence, this practice is a recognition by the insurer of at least a general obligation to make good the amount of any loss to someone in consideration of the premium with really no particular interest as to whom the amount of the fire loss should be payable. This standard practice would seem to accord with the normal expectations of the parties to such transactions.
Although a vendor is not obligated to insure, he may properly do so to the full value of the property, including both the legal and equitable estates which may arise in the event of a sale. Certainly plaintiff retained an insurance interest in the property after the execution of the contract, notwithstanding the operation of the doctrine of equitable conversion.

So here, the vendee may properly insure the full value of the property including legal interest of the vendors.

We further note, as in Wolf, that defendant never tendered a return of a portion of the premium to reflect plaintiffs’ alleged limited interest in the property.

Our attention has been directed to Tauriello v. Aetna Insurance Co., 14 N. J. Super. 530, 532 (Law Div. 1951), where the point was made that a fire insurance policy is a contract not to insure the property against fire but to insure the owner against loss by fire. This principle of law is apparently challenged in Wolf, 100 N. J. Super. at 35, 36.

In Federowicz v. Potomac Ins. Co. of Dist. of Col., 7, App. Div. 2d 330, 183 N. Y. S. 2d 115 (App. Div. 1959), the court construed the same language with which we are here concerned. There, the insured leased land on a year-to-year-tenancy subject to termination by the landlord upon 30 days’ written notice, in which event the insured tenant had the right to remove within five days the buildings placed on the land by him. The buildings were to become the property of the landlord if the tenant did not remove them within the stated period. The standard fire insurance policy issued to the tenant provided that the insurance company insured to the extent of the cash value of the property at the time of loss, but not exceeding repair or replacement cost “nor in any event for more than the interest of the insured.” The court there indicated that the basic issue was whether the quoted language refers to the extent of the physical loss of the insured or his financial loss, and stated:

Absent a finding that Ms interest in the building had been extinguished the triers of the fact should not be permitted to speculate as to the extent of his financial loss by the remoteness or imminence of the termination of his insurable interest. Otherwise stated, the pertinent clause in the policy should be interpreted upon the basis that this was insurance against physical loss and not against financial loss. The contract was one of insurance against loss by fire to a building owned by plaintiff. It was not an agreement to indemnify him to the extent of his financial loss, [at 121]

The facts in the matter before us present a stronger case for the insured than in Federowicz. Plaintiffs were not only the equitable owners of the building, but the land as well. The testimony does not indicate that the title impediments were insurmountable.

Subsequent to oral argument defendant referred us to Peerless Ins. Co., v. Bailey Mortgage Co., 345 F. 2d 14 (5 Cir. 1965). In that case the contract purchasers of a newly constructed dwelling went into possession and obtained from National Indemnity Co. an owner’s fire insurance policy for $12,000. The contract price, including the lot, was $15,000. The purchasers had conveyed their equity in their former home to the builder-seller, receiving a credit of $6,700. The builder-seller had also obtained from Peerless Insurance Company a builder’s risk policy in which the construction loan mortgagee Bailey was expressly covered. The stipulated fire damage amounted to $10,600. The District Court judgment in favor of Bailey against Peerless for $10,600 was affirmed. However, the court held that the contract purchasers’ interest was not equivalent to the full value of the residence, and the judgment they obtained against National for $10,600 could not be sustained. Peerless is factually distinguishable in that the builder-seller was insolvent and had never acquired title to the lot, so that the contract purchasers ffirad little or no chance of ever obtaining the house under their contract for purchase. Their possession was apparently only that of tenants at sufferance.” Id. at 17. Their judgment against National was reversed and the case remanded to the District Court to determine the value of their insurable interest, and to limit the recovery of the contract purchasers to an amount not to exceed the value of such insurable interest. Upon the remand the vendees’ equitable interest was found to be $6,700, the credit they received for the value of their former home. This determination was affirmed in National Indemnity Co. v. Banks, 376 F. 2d 533 (5 Cir. 1967). In the instant case plaintiffs were the equitable owners in possession of a dwelling, with actual legal title being in the sellers, and there was no evidence adduced to support a finding that plaintiffs had “little or no chance” of ever acquiring actual title. On the contrary, the trial court properly found that plaintiffs held a valid and enforceable contract.

Finally, defendant contends that under the contract of sale the risk of loss to the premises by fire was assumed by the sellers. However, since the sellers are not parties to this litigation, we need not determine whether a constructive trust should be applied so as to entitle the vendors to the proceeds of the fire insurance policy. The suit here is between the purchaser under contract and the insurance company. The question of the disposition of all or a portion of the insurance proceeds, once they are in plaintiffs’ hands, is not before this court. Cf. Wolf v. Home Ins. Co., trial court opinion, 100 N. J. Super. at 50, and concurring Appellate Division opinion, 100 N. J. Super. at 359. In any event, the Wolf decisions hold that, assuming the applicability of the constructive trust theory, it is not open to defendant to assert the equitable ownership of another as a defense to a suit on the policy by the vendor. This rationale is likewise applicable to a suit by the equitable owner in possession against the insurance company that issued him a policy of fire insurance.

Although the risk of loss by fire until delivery of title was assumed by the sellers, such contractual provision does not preclude plaintiff Cooke from procuring a fire insurance policy to protect his interest in the property.

Affirmed.


text:
    TOWNSHIP OF CHERRY HILL, COUNTY OF CAMDEN, PETITIONER-RESPONDENT, v. DIRECTOR, DIVISION OF TAXATION, RESPONDENT-APPELLANT.
    Superior Court of New Jersey Appellate Division
    Argued March 27, 1972
    Decided May 18, 1972.

      Before Judges Con ford, Matthews and Ebitz.

      Mr. Richard M. Conley, Deputy Attorney General, argued the cause for appellant (Mr. George F. Kugler, Jr., Attorney General, attorney; Mr. Stephen Skillman, Assistant Attorney General, of counsel).

      Mr. Alexander Feinberg argued the cause for respondent (Mr. Ralph J. Kmiec, attorney).
   Per Curiam.

The Director of the Division of Taxation appeals from the revision by the Division of Tax Appeals, on appeal by Cherry Hill, of his determination of the equalized valuations of Cherry Hill for 1970, for purposes of distribution of state school aid. The appeal to this court is confined to the Division’s readjustment of the 1969 factor of the 1970 certified final equalized valuations by deduction of reductions in 1969 tax assessments by the Camden County Board of Taxation on appeals by individual taxpayers.

The Division agreed with Cherry Hill that there was a fatal inconsistency in the Director’s method in that, while he made adjustments for increases in the 1969 valuations to reflect added and omitted assessments for that year, he ignored reductions consequent upon tax appeal reductions. The testimony of the Director’s representative, Samuel Tern-kin, as expanded upon by him in response to questions from the court at oral argument, satisfies us that there was reasonable administrative justification for the Director’s procedures in the respects mentioned, at least in the context of state school aid purposes, and that the Division should not have overruled his actions in that regard. Eor discussion of the breadth of discretion reposed in the Director in formulating details of methodology in arriving at equalized valuations for state school aid distribution purposes, see Bayonne v. Division of Tax Appeals, 49 N. J. Super. 230, 239 (App. Div. 1958).

The evidence is that the Director adds to the certified equalized valuations of the prior year the added and omitted assessments applicable thereto by applying to them the equalization factor represented by the official ratio of that prior year. Those added and omitted assessment figures are routinely available to the Director from the county tax boards. Giving weight to them for state school aid purposes is fair, since in the long run all municipalities will have more or less added and omitted assessments. Figures for aggregate reductions in assessment on appeal, on the other hand, are inconclusive until the final course of all appellate procedures is concluded. The Director’s experience, moreover, is that the statistical capacity of the 21 county tax boards is not such as to make the relevant figures readily available to him from all of them, and the factor in question, if used at all, would have to be applied uniformly statewide.

A second, and more significant reason for not applying the reduction-in-assessments factor, according to the Director, is that if any of the properties appealed and reduced have also been the subject matter of a sale entering into the Director’s sales ratio for the prior year, distortion, would, result if there were a simple application to such reductions of the certified ratio figure of the prior year. Avoidance of such distortion would require recomputation of the original certified ratio figure by employment of the reduced assessment valuations of the properties sold rather than, as had been the case originally, the unreduced valuations, in determining the overall ratios of sales prices to assessed valuations. To do this on a statewide basis, as the Director reasonably believes would be necessary, would appear to involve a massive annual administrative exercise not worth the theoretical promotion of the fairness in state school aid distribution it would induce.

We find that the reasons for the Director’s actions in the respects here complained of dispel any basis for interference therewith by the Division of Tax Appeals, which is authorized to intervene only if it is shown that the “ratio or ratios [of the Director] could not reasonably be justified.” N. J. S. A. 54:1-35.4.

We have thought it advisable to decide the question discussed above on its merits, for guidance of all concerned, rather than evade it on the basis of appellant’s alternative argument that any change in Cherry Hill’s certified ratio for 1970 could not in fact increase its 1970 state school aid because of the fortuitous effect of a “save harmless” provision of the school aid legislation.

Notwithstanding the fact last mentioned, Cherry Hill pursued its appeal below because of the feared real effect, in terms of county tax burden, of the mechanical acceptance by the Camden County Tax Board of the Director’s table of equalized valuations for Camden County in arriving at the 1970 county equalization table. This collateral effect also influenced the decision of the Division of Tax Appeals. Such consequences, however, are not remediable by appeal of the Director’s table but rather by appeal of the county equalization table to the Division of Tax Appeals. Not only are the purposes and effects of the respective tables different but so also is the scope of review and correction thereof by the Division of Tax Appeals under the discretely applicable statutes (re-equalization de novo on appeal from the county equalization table, see Wood-Ridge v. Bergen Cty. Bd. of Tax., 111 N. J. Super. 174, 181 (App. Div. 1970); absence of “reasonable justification,” on appeal from the Director’s table). The Director’s table is by no means binding on any county tax board for county equalization purposes. As to considerations appropriately to be weighed in relation to an appeal of a county equalization table challenged on grounds comparable to those involved here, compare the ease last cited with In re Millburn Tp., 110 N. J. Super. 330 (App. Div. 1970). For other considerations going to the validity of either kind of table see Kearny v. Division of Tax Appeals, 35 N. J. 299 (1961).

The judgment of the Division of Tax Appeals is reversed to the extent of the determination expressed hereinabove.

      In 1970, for the first time, the Director adopted the system of determining final certified equalized valuations for a current year (1970) by averaging the final certified equalized valuations for the prior year (1969) with a tentative table of equalized valuations for the current year arrived at by applying a ratio based upon comparisons of sales to assessed valuations of the current period.

      It should be kept in mind that changes in equalized valuations of any particular municipality for state school aid purposes do not in any way affect receipts of such aid by any other municipality. This contrasts with changes in county tax equalization tables where a change of the figures for one taxing district affects the county tax burden of all others in the county.


text:
    STATE OF NEW JERSEY, PLAINTIFF-RESPONDENT, v. HOWARD FORD, DEFENDANT-APPELLANT.
    Superior Court of New Jersey Appellate Division
    Argued April 18, 1972
    Decided May 18, 1972.

      Before Judges Labrecqtte, Koeovse:y and Allcokn.

      Mr. Thomas E. Bracken, Assistant Deputy Public Defender, argued the cause for appellant (Mr. Stanley G. Van Ness, Public Defender, attorney; Mr. Bracken, of counsel and on the brief).

      Mr. Alfred J. Luciani> Deputy Attorney General, argued the cause for respondent (Mr. Vincent P. Keuper, Monmouth County Prosecutor, attorney; Mr. Edward Boy Bosen, Assistant Prosecutor, on the brief).
   Per Curiam.

Defendant Howard Ford was indicted for possession and sale of heroin on September 30, 1970, January 5, 1971 and January 7, 1971. On May 11, 1971 he entered pleas of guilty to possession of heroin on September 30, 1970, and sale on January 5 and January 7, 1971. He was sentenced on June 11, 1971 to concurrent terms of 7-10 years in the New Jersey State Prison for each offense. His present appeal followed.

Defendant first challenges his 7-10 year sentence for possession of heroin on September 30, 1970 as illegal and violative of due process in that the maximum sentence for that offense, as prescribed by the New Jersey Controlled Dangerous Substance Act, L. 1970, c, 226 (N. J. S. A. 24:21-1 et seq.), which went into effect on January 17, 1971, was five years. N. J. S. A. 24:21-20 (a) (1). Prior thereto, N. J. S. A. 24:18-47(c) (1) had fixed the maximum term of imprisonment for possession at 15 years.

We find defendant’s contention to be without merit. N. J. S. A. 24:21-1 et seq., the Controlled Dangerous Substance Act, which went into effect after the commission of the present offenses but before the entry of defendant’s plea of guilty to possession, provided that “Prosecutions for any violation of law occurring prior to the effective date of this act shall not be affected or abated by the repealers contained in section 47 of this act.” N. J. S. A. 24:21-40(a). While defendant argues that the foregoing provision does no more than preserve properly founded indictments for offenses which antedate the effective date of the statute, this contention is negated by subsection (d) of N. J. S. A. 24-21-40. which further provides that: “The provisions of this act shall be applicable to violations of law * * * which occur following its effective date.” In view of this clear demonstration of legislative intent, we hold that repeal of the prior law was to be effective only as to violations occurring on and after the effective date of the new law, January 17, 1971. Thus the five-year maximum for possession contained therein did not apply and the sentencing judge was free to exercise his discretion within the limits prescribed by N. J. S. A. 24:18-47(c) (1). To the extent that State v. Haynie, 115 N. J. Super. 417 (Cty. Ct. 1971), may be considered as calling for a holding to the contrary, it is disapproved.

In view of the absence of any reasonable doubt as to the legislative intention, In re Estrada, 63 Cal. 2d 740, 48 Cal. Rptr. 172, 408 P. 2d 948 (Sup. Ct. 1966), and People v. Oliver, 1 N. Y. 2d 152, 151 N. Y. S. 2d 367, 134 N. E. 2d 197 (Ct. App. 1956), cited by defendant, are inapposite.

Proceeding to defendant’s second point, we are convinced that his commitment to the New Jersey State Prison for the term indicated was manifestly excessive. .He was 25 years of age and an admitted homosexual at the time of his sentence. However, his previous convictions involved neither possession nor sale of narcotics and he represented to the court that he was no longer using narcotics.

We incline to the view that the ends of justice will best be served by the reduction of his sentences to terms of 3-5 years in State Prison on each count, to run concurrently with each other and with any other terms he may be serving.

Affirmed, as modified.


author: Seidman, J. C. C.

text:
    STATE OF NEW JERSEY, PLAINTIFF, v. PUBLIC SERVICE ELECTRIC & GAS COMPANY, A NEW JERSEY CORPORATION, DEFENDANT.
    Superior Court of New Jersey Chancery Division
    Decided May 17, 1972.

      Mr. Lemuel Skidmore, for claimant J. Malcolm Moss-man {Messrs. Hartlaub, Braun, Thorn, Doiien and Skid-more, attorneys).

      Mr. Boberi W. Dempsey, Deputy Attorney General, for State of New Jersey {Mr. George F. Kugler, Jr., Attorney General, attorney).
   Seidman, J. C. C.

(temporarily assigned). This matter is before the court on a claimant’s motion to reopen and amend a final judgment of escheat. The basic facts are not in substantial dispute.

The question to be resolved is whether a claimant who has made a timely application to reclaim some escheated property can, more than two years after the filing of the escheat judgment, present a claim for additional escheated property mistakenly omitted from the prior application.

There appears to be no reported case in this State on the precise issue involved herein.

Although the State does not challenge the claimant’s allegations, its position is that the application is barred by the expiration of the statutory two-year period. The claimant contends that on the facts here present the court has the power to grant the relief sought notwithstanding the passage of time.

The final judgment, entered September 12, 1969 and amended December 22, 1969, escheated to the State unclaimed interest on bonds of the Public Service Electric & Gas Company or its predecessor companies in the aggregate amount of $16,712.50, and unclaimed funds representing moneys for the redemption of the bonds in the aggregate amount of $13,888.75.

In August 1971 J. Malcolm Mossman, the claimant herein, applied pursuant to N. J. S. A. 2A:37-28 to reopen the judgment in order to establish his ownership of part of the escheated property. According to the supporting affidavits and documents, Mossman, a resident of New York City and described as a person of advanced years who lived alone and failed to pay close attention to his business affairs, claimed ownership of coupons in the total amount of $11,500 which had formerly been attached to 10 $1000, 5% first mortgage bonds of the Hudson County Gas Company (a predecessor of Public Service Electric & Gas Company). His New York counsel and attorney-in-fact, Irving D. Goodstein, related that on or about November 10, 1970 he caused the bonds to be presented for payment to Commercial Trust Company of New Jersey, together with attached uncollected coupons in the sum of $2000 for the period May 1, 1946 to November 1, 1949. He further stated that although the principal of the bonds was paid in full, he was advised by the bank that the funds of the payment of the coupons had escheated to the State. Payment of 380 additional detached coupons, each valued at $25, for the years 1927 through 1945, found in Mossman’s safe deposit box, was refused for the same reason. The claimant denied previous knowledge of the escheat proceedings.

The court being satisfied that the claimant was the owner of the coupons and that he had not had actual notice of the escheat action, and no opposition being offered by the State, an order was entered August 13, 1971, amending the final judgment and directing the State Treasurer to pay the sum of $11,476.19 to the claimant, representing the accumulated interest on the bonds less a pro rata share of the expenses incurred by the State.

The present application, filed in March 1972, is “for an order pursuant to N. J. S. A. 2A:37-28 amending the Judgment entered in the above entitled matter on August 13, 1971, which reopened and amended the final judgment entered September 12, 1969, as amended December 22, 1969, to direct that the sum of $10,000, represents (sic) the principal of $10,000 bonds of Hudson County Electric and Gas Company (sic), less expenses of this action attributed thereto,” be paid to the claimant.

Goodstein’s supporting affidavit sets forth, in substance, that in January 1972 he discovered the bonds had in fact not been redeemed but were being held by Chemical Bank in New York. An attached copy oí a Chemical Bank Trust department form, dated November 10, 1970, acknowledges receipt of the bonds which, apparently, were to be sent to the Commercial Trust Company of New Jersey for redemption. The latter bank, on November 19, 1970, informed Chemical Bank that “[cjoupons of Hudson County Gas Company for $2,000.00 are not collectable in usual manner,” and suggested that contact be made with the New Jersey Department of the Treasury. The lack of reference to the bonds is not explained. Photocopies of 10 Hudson County Gas Company bonds dated November 1, 1899, and due November 1, 1949, are also attached to the supporting affidavits. Goodstein’s position is that he had assumed mistakenly that the bonds had been redeemed.

N. J. S. A. 2A:37-28 deals with the reopening of an escheat judgment:

Any person whose property may have escheated to the State as provided herein, or any rightful heir or next of kin entitled to such property by descent or succession may, within 2 years after the filing of tlie final judgment in the Superior Court, apply to said court to reopen tlie said judgment and upon proof that he was without actual knowledge of such escheat action, and upon proof of ownership of such property or the right to possession thereof, the court may in its discretion reopen the judgment and in the event that the aforesaid judgment in part or in whole be revised or amended, the court may direct the State Treasurer to repay such part of the moneys received by the State Treasurer by reason of such judgment, to the party in the amended judgment entitled to have the same, and upon the entry of such final judgment the State Treasurer shall repay the said moneys as provided in such judgment; provided, however, that there shall first be deducted all expenses and charges that may have accrued or been paid out by reason of the entry of the original judgment. * *

The State argues that property is presumed abandoned and subject to escheat after it has remained unclaimed for at least 14 successive years, N. J. S. A. 2A:37-13, and that a claimant has two years after the escheat judgment to rebut such abandonment. The conclusion it draws is that “the additional two year period relates to the abandonment of the property rather than to an extension of time to a particular claimant.” Expressing sympathy for the claimant’s plight, the State, nevertheless, urges that the court cannot engraft on the period of limitation established by the Legislature exceptions not contained therein, however inequitable the enforcement of the statute, without such exceptions, may be.

The claimant’s thesis is that since he had made a timely application to reopen the judgment, and since the omission of the bonds therefrom resulted from mistake, the intention to abandon the bonds has been rebutted and he should now be allowed to submit further proof of ownership of the bonds in question.

It is clear from the claimant’s allegations, if accepted as true, that his earlier failure to assert ownership of the bonds and claim so much of the escheated money as would be required to redeem them came from an erroneous belief that they had already been redeemed. There is no doubt the bonds would otherwise have been included in the prior application, well within the two-year period prescribed by the statute. The bonds were in Goodstein’s possession in November 1970. This is established by the Chemical Bank receipt as well as his letter of December 6, 1970 to the Department of the Treasury, in which reference is made to bonds owned by Mossman, “recently redeemed and paid through the Commercial Trust Company of New Jersey,” and to “$2000.00 uncollected coupons attached to said bonds covering period 5/1/46 to 11/1/49”.

In the case of State by Parsons v. Standard Oil Co., 5 N. J. 281, 307-308 (1950), aff’d 341 U. S. 428, 71 S. Ct. 822, 95 L. Ed. 1078 (1951), the court held that a judgment of escheat did not terminate the right to rebut the presumption of abandonment and claim the res. This right was reserved to the owner in absolute and unconditional terms for a period of two years after entry of the judgment, exercisable by a motion to reopen the judgment. The court said:

In the performance of this function, the court is not vested with arbitrary discretion. The exercise of the statutory discretion implies conscientious judgment, not arbitrary action. The statutory criteria of ownership or right of possession and a failure of actual notice of the escheat proceeding control the exercise of the power. When these conditions are met, the court must give judgment for the claimant. In the classic terms of Lord Mansfield, judicial discretion “means sound discretion guided by law. It must be governed by rule, not by humour; it must not be arbitrary, vague, and fanciful; but legal and regular.” Rex. v. Wilkes, 4 Burr. 2527, 2539, 98 Eng. Rep. Full Reprint 327 (1770). The statute provides no other standard of judicial action. It has in view a mere legal discretion—“a discretion to be exercised in discerning the course prescribed by law; and, when that is discerned, it is the duty of the court to follow it.” Osborn v. Bank of United States, 9 Wheaton 738, 866, 6 L. Ed. 204 (1824).

In the exercise of the right granted by statute the claimant herein moved to reopen the judgment within the two-year period and thereby rebutted the presumption of abandonment, at least with respect to the coupons. Having done so, should he now be prevented from claiming the bonds to which the coupons related, omitted through error from the previous timely motion? It is the view of the court that he should not.

Since the escheat statute works a forfeiture, it should be strictly construed. It has been held that any doubt as to whether property is subject to escheat is resolved against the State. State v. United States Steel Corp., 12 N. J. 38, 47 (1953); State, by Parsons v. United States Steel Corp., 22 N. J. 341, 355 (1956). See also, State v. New Jersey National Bank, 117 N. J. Super. 38, 47-48 (Ch. Div. 1971). This principle of strict construction ought to apply as well in determining whether the relief sought herein should be granted.

The purpose of the motion now before the court is to amend the judgment entered on August 13, 1971. To that extent it is, in effect, a motion for relief from a judgment or order pursuant to R. 4:50-1, which provides, in pertinent part, that on motion the court may relieve a party from a final judgment, order or proceeding for any of the reasons stated therein, including mistake (clause (a)), or any other reason justifying relief from the operation of the judgment or order (clause (f)). R. 4:50-2 requires that the motion shall he made within a reasonable time, and for reason (a), not more than one year after the judgment order or proceeding was entered or taken. In either case, the present motion is timely.

Invoking R. 4:50-1 is, in the judgment of the court, an appropriate way to deal with the problem before it. If the motion is considered within the scope of R. 4:50-1 (a), the existence of a mistake is evident. However, it also fits within clause (f), and is thus addressed to the broad discretion of the court to be exercised according to equitable principles. The very essence of (f) is its capacity for relief in exceptional situations, and in such eases its boundaries are as expansive as the need to achieve equity and justice. Court Investment Co. v. Perillo, 48 N. J. 334, 341 (1966). See also Hodgson v. Applegate, 31 N. J. 29, 41 (1959); In re Manfredini, 24 N. J. Super. 59, 64 (App. Div. 1952); In re Estate of Cory, 98 N. J. Super. 208, 216 (Ch. Div. 1967); Bauer v. Griffin, 104 N. J. Super. 530, 540 (Law Div. 1969), aff’d 108 N. J. Super. 414 (App. Div. 1970).

In the ease of State, by Parsons v. Standard Oil Co., 5 N. J. Super. 460, 468 (Ch. Div. 1949), mod. 5 N. J. 281 (1950), the court said that in the composition of the Escheat Act the Legislature expressly conferred upon the former Court of Chancery exclusive jurisdiction over the contemplated proceedings, presumably with the intention that such proceedings would be governed by the principles and practices of a court of equity.

It should also be noted that the subject matter of the claim now being asserted is essentially the same as that contained in the prior application. The situation is analogous to permitting a complaint to be amended, even though the statutes of limitations has run, where it states no new cause of action but merely asserts a claim arising out of the transaction described in the original complaint.

It is the conclusion of the court, on the basis of the facts here present and for the reasons hereinabove set forth, that the claimant should be permitted to reopen the judgment of August 13, 1911, and, upon proof of ownership of the bonds in question and of the pertinent allegations in the moving papers, to have the judgment revised and amended accordingly.

An appropriate form of order should be submitted pursuant to R. 4:42-1.


text:
    DAVID B. KELLY, SUPERINTENDENT, DIVISION OF STATE POLICE OF THE STATE OF NEW JERSEY, PLAINTIFF-RESPONDENT, v. JOHN L. STERR, DEFENDANT-APPELLANT.
    Superior Court of New Jersey Appellate Division
    Argued May 16, 1972
    Decided May 26, 1972.

      Before Judges Lewis, Halpebn and Loba.

      Mr. Patrick T. McGahn, Jr., argued the cause for appellant.

      Mr. Michael B. Perle, Deputy Attorney General, argued the cause for respondent (Mr. George F. Kugler, Jr., Attorney General of New Jersey, attorney).
   Per Curiam.

Appellant Sterr was found guilty on three specified charges of violating the General Rules and Regulations of the Department of the State Police. He was suspended without pay and allowances for two weeks. He appeals from that determination.

Appellant was tried at a departmental hearing by State Police Captain George R. Quinn, a summary court officer appointed for that purpose by the Superintendent of the State Police. The hearing was held at State Police Troop (A) Headquarters in Hammonton, New Jersey. Appellant was represented by counsel, but the general public was excluded from the hearing.

Appellant seeks to reverse his conviction upon the ground that he was deprived of the right to a public trial. He argues that the hearing was a gmsi-judicial proceeding and that a public trial is mandated by the N. J. Const. (1947), Art. I, par. 10, which provides in relevant part that “In all criminal prosecutions the accused shall have the right to a speedy and public trial * * He cites no New Jersey authority for his contention (nor have we found any), but argues that fundamental fairness requires it. We disagree, and hold that an administrative hearing of this type is not a criminal proceeding requiring a trial at which the general public must be admitted. It is nothing more than an inquiry into appellant’s actions to determine whether he violated departmental regulations and, if he did, to impose appropriate sanctions within designated limits.

He further contends that “there is no evidence that the hearing officer was qualified to conduct the hearing.” He combines this allegation with the vague statement that the officers who investigated the case, as well as the officer who heard and decided the case, were members of the New Jersey State Police. The intimation is that it resulted in his not receiving a fair trial, even though the hearing officer did not participate in the investigation. Again, he cites no New Jersey authority for his contention, nor does he show any resulting prejudice.

The hearing officer was appointed pursuant to legislative authority, and his findings reviewed and concurred in by the appropriate reviewing authority. Except where the Legislature has otherwise provided, such has traditionally been the accepted practice in administrative hearings, and we see no infirmity therein. See In re Bernaducci, 85 N. J. Super. 152 (App. Div. 1964), certif. den. 44 N. J. 402 (1965) and eases cited therein; Zober v. Turner, 106 N. J. L. 86 (E. & A. 1930). Absent a showing that the hearing officer was not qualified to conduct the hearing, that he was prejudiced ox otherwise disqualified from presiding, his designation is not open to challenge. We cannot sanction such proofs being elicited by counsel, at time of hearing, by cross-examining the designated hearer. In any event, our examination of the record clearly indicates he was eminently qualified.

What appellant is really complaining about in the two issues herein discussed is that the hearing did not comport with due process. We strongly disagree. Appellant was a member of the New Jersey State Police force which was duly established by the Legislature; the General Rules and Regulations which he allegedly violated were promulgated in accordance with legislative authority; he was notified of the charges made against him; he was represented by counsel; he had the opportunity to be heard and be confronted with the witnesses against him; he had the opportunity to cross-examine all witnesses, and a factual determination was made so that he is able to pursue a meaningful appeal. We find that procedural due process, in its fullest sense, has been complied with and appellant has received a fair trial. Groppi v. Leslie, 404 U. S. 496, 92 S. Ct. 582, 30 L. Ed. 2d 632 (1972); Specht v. Patterson, 386 U. S. 605, 87 S. Ct. 1209, 18 L. Ed. 2d 326 (1967); Tibbs v. Board of Ed., Franklin Tp., 59 N. J. 506 (1971); In re Bernaducci, supra, 85 N. J. Super. at 154-155.

Finally, appellant contends “the evidence does not support the findings and sentence * * We have carefully reviewed the entire record and conclude there was sufficient substantial evidence therein to support the findings and conclusions. Atkinson v. Parsekian, 37 N. J. 143, 149 (1962); Manyon v. Schwarzkopf, 100 N. J. L. 22, 24-25 (Sup. Ct. 1924).

Affirmed.