CITY OF NORTH WILDWOOD VS. BOARD OF EDUCATION OF THE CITY OF WILDWOOD (L-0402-15, CAPE MAY COUNTY AND STATEWIDE)

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court." Although it is posted on the
internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-4138-16T2
CITY OF NORTH WILDWOOD,
Plaintiff-Appellant,
v.
BOARD OF EDUCATION OF
THE CITY OF WILDWOOD,
Defendant-Respondent.
_____________________________
Argued October 3, 2018 – Decided July 8, 2019
Before Judges Fuentes, Vernoia and Moynihan.
On appeal from the Superior Court of New Jersey, Law
Division, Cape May County, Docket No. L-0402-15.
Joseph Francis Betley argued the cause for appellant
(Capehart & Scatchard PA, attorneys; Joseph Francis
Betley, of counsel; Kelly E. Adler, on the briefs).
William Stephen Donio argued the cause for respondent
(Cooper Levenson PA, attorneys; William Stephen
Donio and Kelli A. Prinz, on the brief).
PER CURIAM
Since 2002, the Board of Education of the City of Wildwood (the Board)
has leased space at St. Simeon's by-the-Sea Episcopal Church in North
Wildwood to serve as a school facility for its preschool and kindergarten
students. The Board leases this space because the City of Wildwood's existing
elementary school is at full capacity and consequently unable to accommodate
all of the students who fall within this age-group. On June 6, 2014, the City of
North Wildwood (North Wildwood) challenged the Board's authority to lease
and operate this educational facility located outside of its jurisdictional
boundaries. North Wildwood views the Board's actions as ultra vires and as an
intrusion on its municipal sovereignty. The Law Division did not find any legal
or factual grounds to support North Wildwood's position. We affirm.
I
North Wildwood initially challenged the Board's operation of this school
in a petition before the State Commissioner of Education (Commissioner), who
referred the matter to the Office of Administrative Law for the development of
an evidentiary record before an Administrative Law Judge (ALJ). The parties
participated in discovery, and ultimately filed cross-motions for summary
disposition, which the ALJ scheduled for oral argument on July 24, 2015. On
July 23, 2015, North Wildwood moved before the ALJ to withdraw its Petition
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without prejudice, to permit it to seek declaratory and injunctive relief against
the Board in the Superior Court.
On August 14, 2015, North Wildwood filed a verified complaint in the
Law Division seeking declaratory and injunctive relief. North Wildwood argued
the Board did not have the legal authority to lease property located outside its
municipal borders to operate an educational program for its students. North
Wildwood also sought an order compelling the Board to find a suitable site to
operate these educational programs within the City of Wildwood. Toward that
end, North Wildwood sought an injunction prohibiting the Board from: (1)
extending its lease beyond the 2015-2016 school year; and (2) operating any
educational program located outside the City of Wildwood. Finally, without
citing any legal authority to support this claim, North Wildwood asked the court
to award it attorney's fees and costs incurred in the prosecution of this civil
action. The Board filed a responsive pleading that included its own request for
affirmative relief in the form of a declaratory judgment validating the manner it
had operated its preschool and kindergarten programs since 2002.
While the matter proceeded in the Law Division through discovery, the
ALJ granted North Wildwood's motion to withdraw its petition before the
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Commissioner but decided to dismiss the matter with prejudice. The ALJ
provided the following explanation for taking this action:
It was only after the extensive case analysis, workup
and motion practice that North Wildwood abruptly
withdrew its petition on July 23, 2015, one day before
oral argument, cognizant that the case was close to
being decided with finality. And North Wildwood . . .
re-filed [its] claims with the Superior Court . . . .
Nonetheless the majority rights and obligations still
must be decided under education law ([T]itle 18A and
[A]dministrative [C]ode 6A). . . . A Superior Court
Judge would have to resort to Title 18A or
Administrative Code 6A to decide the case.
....
I CONCLUDE that the petition filed by North
Wildwood must be DISMISSED with prejudice. North
Wildwood's re-filing with the Superior Court under the
Declaratory Judgment Act was strategic, tactical in
nature, and jurisdictionally improper in the opinion of
the undersigned. It came very late in the process and
more importantly on the eve of possibly deciding the
outcome of the case. The Commissioner of Education
has primary jurisdiction over education matters. The
Superior Court generally defers administrative matters
to the respective state agencies where special expertise
exists under the principle of exhaustion of
administrative remedies or primary jurisdiction. R.
4:69-5. It would be unfair and prejudicial to [the
Board] if the Superior Court invoked the exhaustion of
administrative remedies or primary jurisdiction
doctrines; rejected the relief sought by North
Wildwood; and only to have the case refiled before the
Commissioner. The taxpayers of both cities would
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incur unnecessary legal expenses and an unnecessary
delay in knowing the outcome of the case.
On January 4, 2016, the Commissioner adopted the ALJ's Initial Decision,
and included the following admonition:
[T]he Commissioner makes no findings as to the merits
of [North Wildwood's] pending Superior Court action.
Certainly, [North Wildwood] can elect to pursue its
claim elsewhere . . . but not while leaving the door open
to duplicative future litigation before the
Commissioner. Given this late stage, and the well-
documented efforts already expended by [the Board] to
defend against and resolve this action, [North
Wildwood] should be precluded from returning to the
Commissioner with the same claim.
After 242 days of discovery in the Law Division, North Wildwood and the
Board filed cross-motions for summary judgment which the court heard on
March 3, 2017. On April 28, 2017, the motion judge issued an order granting
the Board's motion for summary judgment and dismissing North Wildwood's
complaint with prejudice.
As a threshold issue, the judge found North Wildwood had standing to
seek declaratory relief because "the permissible locations where a municipality
may host students for public education is a question of public interest, and given
the liberalized standard for standing in New Jersey, the facts show . . . [North
Wildwood] has a sufficient stake in the outcome." Although the Commissioner
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had previously dismissed with prejudice North Wildwood's petition, the motion
judge concluded this did not preclude it from bringing this declaratory judgment
action in the Law Division. The judge characterized the Commissioner's
decision as predicated "purely on procedural grounds." In the judge's view,
because the Commissioner did not decide the merits of the action, the doctrine
of res judicata did not apply.
Against this backdrop, North Wildwood appeals arguing the Law Division
erred in holding: (1) this issue was within the primary jurisdiction of the
Commissioner; and (2) N.J.S.A.18A:20-4.2(a) gives the Board the express or
implied authority to lease private property outside its municipal borders to
operate a kindergarten or preschool program. In response, the Board argues
whether it may lease space for the purposes of educating its preschool and
kindergarten students involves the interpretation of Title 18A, and thus falls
squarely within the primary jurisdiction of the Commissioner.
II
Before we begin our legal analysis, we will briefly describe the factual
background that led to this legal dispute between these two public entities. The
Board is "a body corporate" organized under N.J.S.A. 18A:10-1, responsible for
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the operation of the public schools in the City of Wildwood. The Board has a
send-receive relationship with North Wildwood for grades nine through twelve.
In 2002, the Board entered into a lease agreement with St. Simeon's to use
and occupy an annex to the church to house its preschool and kindergarten
students. The Board formally approved this arrangement in the public session
of a meeting, in accordance with the Open Public Meetings Act, N.J.S.A. 10:4-
6 to -21. Since 2003, the Board has formally approved the renewal of the lease
a number of times. The most recent lease which the Board approved on April
25, 2016, was for a three-year term beginning September 1, 2016 and ending on
August 31, 2019. The State Department of Education, represented by the
Executive County Superintendent of Schools for Cape May County, formally
approved the use of the Annex as additional classroom space.
The Annex is located on the border of North Wildwood and the City of
Wildwood and contains six classrooms, a teacher's lounge, two girl's bathrooms,
two boy's bathrooms, three office spaces, a kitchen, and a playground. As of
October 2016, 129 children were enrolled in the preschool and kindergarten
classes. The Board and North Wildwood have separate liability insurance
policies covering the Annex. In the event of a fire-related emergency at the
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Annex, both the City of Wildwood Fire Department and the North Wildwood
Fire Department have agreed to respond.
In a certification dated April 21, 2015, Kevin Yucco, the City
Administrator of North Wildwood, claimed he first became aware that the Board
was operating a school at the Annex in 2014, when the Chief of Police told him
that the Cape May County Prosecutor's Office requested that he "enter into a
Memorandum of Agreement 1 with [the Board] for the preschool and
kindergarten students from the City of Wildwood that attend s chool at . . . the
Annex at St. Simeon's." Yucco claimed that prior to this, he assumed St.
Simeon's was operating a private day care or preschool program.
The Board claims North Wildwood was aware that it was using the Annex
to accommodate its preschool and kindergarten programs because Patrick
Rosenello, the current Mayor of North Wildwood, was a member of the Board
as a Sending District Representative 2 when the Board first leased the Annex in
1
See N.J.A.C. 6A:16-6.2(b)(13).
2
Rosenello submitted a certification in response to the Board's position in this
litigation in which he admits he was a member of the Board in 2002. However,
he claims he was not aware of the lease arrangement because his role on the
Board was statutorily circumscribed pursuant to N.J.S.A. 18A:38-8.1 and by a
resolution the Board adopted prior to 2002 that limited his participation to
"matters concerning Wildwood High School."
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2002. The Board also notes that North Wildwood's Police and Fire Departments
have conducted safety drills and presentations at the Annex during the relevant
time period. The record also contains several articles published in local
newspapers regarding Wildwood's students utilizing the Annex.
III
We first address North Wildwood's standing to bring this action in the
Law Division. The issue of standing is a legal question, which is subject to this
court's de novo review. Courier-Post Newspaper v. Cty. of Camden, 413 N.J.
Super. 372, 381 (App. Div. 2010) (citing In re Project Authorization Under N.J.
Register of Historic Places Act, 408 N.J. Super. 540, 555 (App. Div. 2009)).
"Standing 'refers to the plaintiff's ability or entitlement to maintain an action
before the court.'" In re Adoption of Baby T, 160 N.J. 332, 340
(1999) (quoting N.J. Citizen Action v. Riviera Motel Corp., 296 N.J. Super. 402,
409 (App. Div. 1997)). New Jersey courts liberally grant a litigant standing to
sue. Jen Elec., Inc. v. Cty. of Essex, 197 N.J. 627, 645 (2009). Generally, there
is standing if the party seeking relief has "a sufficient stake and real adverseness
with respect to the subject matter of the litigation [and a] substantial likelihood
of some harm . . . in the event of an unfavorable decision[.]" Jen Elec., Inc., 197
N.J. at 645 (quoting In re Adoption of Baby T, 160 N.J. at 340).
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"The threshold to prove a party's standing is 'fairly low.'" EnviroFinance
Grp., LLC v. Envtl. Barrier Co., LLC, 440 N.J. Super. 325, 340 (App. Div. 2015)
(quoting Reaves v. Egg Harbor Twp., 277 N.J. Super. 360, 366 (App. Div.
1994)). Thus, where "the proceeding serves the public interest" and the
"plaintiff is not simply an interloper," standing will likely be found. N.J. Citizen
Action, 296 N.J. Super. at 415 (quoting In re Quinlan, 70 N.J. 10, 34-35 (1976)).
In determining the question of a party's standing in a civil matter, a court should
also consider if the issue implicates a substantial public interest. In re Grant of
Charter to Merit Preparatory Charter Sch. of Newark, 435 N.J. Super. 273, 280
(App. Div. 2014) (finding standing where the issue involved a "substantial
public interest"); Finkel v. Twp. Comm. of Hopewell, 434 N.J. Super. 303, 315-
16 (App. Div. 2013).
North Wildwood argues it has standing because the legal question raised
here is a novel one that implicates a matter of substantial public importance, to
wit, "whether a public school district can continually and/or permanently operate
its educational programs beyond its geographic and political limits . . . [.]"
North Wildwood postulates several scenarios in which it would be required to
expend municipal resources based only on Wildwood students' participation in
and attendance of programs offered at the Annex.
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These possible situations include: (1) dispatching public safety personnel
from its Police and Fire Departments in response to incidents arising from the
presence of students in the Annex; (2) participating in fire inspections and drills
at the Annex; and (3) allocating North Wildwood employees to perform crossing
guard duties for Annex-students. North Wildwood's arguments are predicated
on the concern that, should a Wildwood student be injured or otherwise in need
of emergency care at the Annex, North Wildwood public safety personnel would
be required to assume the role of first responders.
By contrast, the Board argues North Wildwood has not provided any
competent evidence that shows that in the twelve years the Annex has housed
this educational program, North Wildwood has expended municipal resources
exclusively due to Wildwood's children's use of the Annex. The Board also
points out that North Wildwood is obligated to provide emergency services to
anyone leasing the St. Simeon's site. Thus, North Wildwood has not suffered
any actual harm nor expended additional resources due to the Board's use of the
Annex.
Despite the Board's logically compelling arguments, the Law Division
found North Wildwood had standing to raise this issue. The motion judge held
that "the permissible locations where a municipality may host students for public
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education is a question of public interest . . . [.]" In light of our State's well-
settled jurisprudence in favor of granting a litigant standing to sue in cases
involving issues of public interest, Jen Elec., Inc., 197 N.J. at 645, we hold that
North Wildwood has, by the slimmest of margins, provided a sufficient basis to
establish standing to litigate this case.
We turn next to the issue of jurisdiction. In this respect, we agree with
the motion judge that the Commissioner has primary jurisdiction. The
dispositive legal question is "whether [the Board] is permitted to have students
attending school outside of its municipality, either temporarily or permanently."
The judge thus rejected North Wildwood's attempt to reframe the issue to a
determination of whether the Board was acting outside of its statutory authority.
As the motion judge correctly held, the statutes applicable to this issue are all
under Title 18A. Thus, this issue squarely falls under the Commissioner's
primary jurisdiction.
We review the Law Division's decision de novo because it was based
entirely on a question of law. State v. Quaker Valley Farms, LLC, 235 N.J. 37,
55 (2018). To determine whether the doctrine of primary jurisdiction applies, a
court must weigh the following factors:
1) whether the matter at issue is within the conventional
experience of judges; 2) whether the matter is
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peculiarly within the agency's discretion, or requires
agency expertise; 3) whether inconsistent rulings might
pose the danger of disrupting the statutory scheme; and
4) whether prior application has been made to the
agency.
[Muise v. GPU Inc., 332 N.J. Super. 140, 160 (App.
Div. 2000) (quoting Boldt v. Correspondence Mgmt.,
Inc., 320 N.J. Super. 74, 85 (1990)).]
Because the controversy before us involves the application and
interpretation of Title 18A, the Commissioner has primary jurisdiction to hear
and determine all of the issues raised by the parties. Bower v. Bd. of Educ. of
E. Orange, 149 N.J. 416, 420 (1997); G.D.M. v. Bd. of Educ. of Ramapo Indian
Hills Reg'l High Sch. Dist., 427 N.J. Super. 246, 259 (App. Div. 2012). The
New Jersey School Laws, N.J.S.A. 18A:1-1 to -76-4, empower local school
boards to operate public schools for their respective districts. See N.J.S.A.
18A:8-1; N.J.S.A. 18A:10-1; N.J.S.A. 18A:11-1. The Department of Education
is "a principal department in the executive branch of the state government."
N.J.S.A. 18A:4-1. The Commissioner is "[t]he chief executive and
administrative officer of the department," who has "general charge and
supervision of the work of the department," N.J.S.A. 18A:4-22(a), and has
"jurisdiction to hear and determine . . . all controversies and disputes arising
under the school laws . . . [.]" N.J.S.A. 18A:6-9.
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As an appellate court, we owe "institutional respect . . . for the
Commissioner's first-instance jurisdiction 'to hear and determine . . . all
controversies and disputes arising under the school laws[.]'" Archway
Programs, Inc. v. Pemberton Twp. Bd. of Educ., 352 N.J. Super. 420, 424 (App.
Div. 2002) (second and third alterations in original) (quoting N.J.S.A. 18A:6-
9). Moreover, "[t]he Commissioner's authority is plenary." Ibid. (citing Abbott
v. Burke, 100 N.J. 269, 301 (1985)). Thus, "the Commissioner of Education has
primary jurisdiction to hear and determine all controversies arising under the
school laws." Bower v. Bd. of Educ. of E. Orange, 149 N.J. 416, 420 (1997)
(citing N.J.S.A. 18A:6-9). The Board of Education is the "agency ultimately
charged with implementation of the school laws." The Commissioner's
"statutory interpretation is entitled to considerable weight, where not
inconsistent with the statute and in harmony with the statutory purpose."
Kletzkin v. Bd. of Educ.of Spotswood, 136 N.J. 275, 278 (1994).
We thus affirm the Law Division's order dismissing North Wildwood's
declaratory judgment action. We do not express any opinion concerning
whether North Wildwood is barred from seeking any relief before the
Commissioner under the doctrine of res judicata or judicial estoppel.
Affirmed.
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