Another Mount Laurel Case for the Supreme Court?

In re Declaratory Judgment Actions Filed by Various Municipalities, 446 N.J. Super. 259 (App. Div. 2016).  It has been 41 years since the Supreme Court issued its original Mount Laurel opinion.  Southern Burlington Cty. NAACP v. Mount Laurel Tp., 67 N.J. 151 (1975) (discussed here).  Judge Fasciale’s opinion yesterday in the attached case offers a comprehensive history of the Mount Laurel doctrine, from that date through last year’s Supreme Court decision in In re Adoption of N.J.A.C. 5:96 and 5:97 by the New Jersey Council on Affordable Housing, 221 N.J. 1 (2015).  There (as discussed in more detail here), the Supreme Court stripped the Council on Affordable Housing (“COAH”) of its power to determine municipalities’ fair share of low and moderate income housing and returned that power to the courts.  The attached case is the first published opinion to appear in the wake of the Court’s action.

The issue presented was whether, in calculating fair shares, “a new, ‘separate and discrete’ component,'” namely, a “calculation for establishing a municipality’s affordable housing need from 1999 to 2015 (the gap period)” is required in addition to calculations of “unmet prior round [recall that it was COAH’s failure to address third-round obligations that led to its powers being transferred to the courts, and that there have been two prior rounds] obligations from 1987 to 1999,” “present need,” and “prospective need.”  The Law Division, adopting the view of an expert for plaintiffs, ruled that the gap period calculation was required, as a matter of constitutional law, from which the Mount Laurel doctrine arises, to be included.  Municipalities sought and were granted leave to appeal, and the Appellate Division reversed, applying the de novo standard of review to the purely legal issue presented.

Judge Fasciale’s 58-page opinion goes into great detail, and it deserves to be read in full.  In summary, however, he concluded that neither “(1) the core principles of the Mount Laurel doctrine, as codified in the Fair Housing Act of 1985 (FHA), N.J.S.A. 52:27D-301 to -329; [nor] (2) In re N.J.A.C. 5:96,” the Supreme Court’s most recent opinion, require or permit the Law Division’s result.  “Although presented with numerous opportunities to do so, at no point did the Court, the Legislature, or the Appellate Division impose an additional separate gap-period obligation.”  The plain language of the FHA, which refers to “present and prospective need,” foreclosed a separate gap period calculation.  Despite amending the FHA twelve times in sixteen years, the Legislature never amended it to include a gap period calculation.  COAH made reference to the gap period, but since the statute did not do so, COAH could not go beyond the statute.  Especially given the separation of powers, neither could the courts.

Judge Fasciale also observed that in In re N.J.A.C. 5:96, the Supreme Court reiterated that “previous methodologies employed in the First and Second Round Rules should be used to establish present and prospective statewide and regional affordable housing need” (emphases omitted).  That too showed the error of the Law Division’s decision.

Finally, the Appellate Division rejected the idea, also accepted by the Law Division, that judicial estoppel required inclusion of a gap period calculation.  On the issue of invoking judicial estoppel, Judge Fasciale applied the abuse of discretion standard.  After discussing judicial estoppel in detail, and noting that it is disfavored, he found the doctrine inapplicable here.  The argument for applying judicial estoppel rested on the parties’ positions in a prior Appellate Division case where the issues were different from those here, and the Supreme Court’s subsequent ruling in In re N.J.A.C 5:96 changed that prior landscape as well.

Doubtless, those who supported the Law Division’s result will go to the Supreme Court.  If the Court grants review, this could be the next big Mount Laurel decision, whichever way it comes out.