Appendix — New Jersey-Philadelphia Presbytery of the Bible Presbyterian Church v. New Jersey State Board of Higher Education
Supreme Court brief1985
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IN THE ad 18 ”
SUPREME COURT OF THE UNITED STAPES®=2. 5"
October Term. 1984
NEW JERSEY-PHILADELPHIA PRESBYTER)
OF THE BIBLE PRESBYTERIAN CHURCH. et al..
Petitioners
[
NEW JERSEY STATE BOARD O}
HIGHER EDUCATION. et al.
Respondents
APPENDIX TO
PETITION FOR A WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF
APPEALS FOR THE THIRD CIRCUIT
William Bentlev Ball
Philip J. Murren
Sandra E. Wise
BALL & SKELLY
311 North Second Street
P.O. Box 1108
Harrisburg. PA 17108
(717) 232-8731
Attorneys for Petitioners
Counsel of Record
October 15. 1984
PACKARD PRESS ‘LEGAL DIVISION. 10th & SPRING GARDEN STREETS. PHILA. PA 19123 (215) 236-2000
TABLE OF CONTENTS
Page
APPENDIX A — Unpublished Opinion of the United
States Court of Appeals for hon Third Circuit
ag ee See Pe ee ee re A-1
APPENDIX B — Unpublished Opinion and Order of
the United States District Court for the District
of New Jersey (July 29, 1983, and September
ee ee re A-7
APPENDIX C — Opinion of the Supreme Court of
New Jersey (August 9, 1982), reported at 90 N.J.
470, 448 A:2d GOS CIGBZ). ... nsw eceess. A-26
APPENDIX D — Opinion and Order of the United
States District Court for the District of New Jer-
sey (May 18, 1981), reported at 514 F.Supp. 506
TN ies sk yk ck ee hk ee eens A-47
APPENDIX E — Opinion and Amendments of the
United States Court of Appeals for the Third Cir-
cuit (April 14, 1981), reported at 654 F.2d 868
Ce, EE cc sock whe ON Suan ee es A-70
APPENDIX F — Opinion and Order of the United
States District Court for the District of New Jer-
sey (January 4, 1980), reported at 482 F.Supp.
ge big Seren eree eer een oan A-169
APPENDIX G — Statutory Provisions Involved . A-200
APPENDIX A
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
No. 83-5774
NEW JERSEY-PHILADELPHIA PRESBYTERY OF
THE BIBLE PRESBYTERIAN CHURCH; SHELTON
COLLEGE, A Ministry of Bible Presbyterian Church;
BIBLE PRESBYTERIAN CHURCH OF COLLINGS-
WOOD, NEW JERSEY; Kevin WILSON, Brad GSEL,
Kevin Clair MICHAEL, Curtis Jordan BASHAW, Louise
OLSON and Everette Charles OLSON,
Appellants
v.
NEW JERSEY STATE BOARD OF HIGHER EDUCA-
TION; T. Edward HOLLANDER, Chancellor of New
Jersey Department of Higher Education; Richard D.
BRESLIN, Assistant Chancellor for Academic Affairs of
the New Jersey Department of Higher Education; and
Amorita SUAREZ, Director of the Office for Independ-
ent College and Universities of the New Jersey Depart-
ment of Higher Education.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY
(D.C. Civ. No. 79-3341)
A-1
A-2
Argued June 22, 1984
Before: ALDISERT, Chief Judge, HIGGINBOTHAM,
Circuit Judge, and HUYETT, District Judge.
(Filed July 17, 1984)
William Bentley Ball, Esq. (ARGUED)
Philip J. Murren, Esq.
Richard E. Connell, Esq.
Sandra E. Wise, Esq.
Ball & Skelly
511 North Second Street
P.O. Box 1108
Harrisburg, Pennsylvania 17108
COUNSEL FOR APPELLANTS
Irwin I. Kimmelman
Attorney General of New Jersey
OF COUNSEL:
James J. Ciancia
Assistant Attorney General
ON THE BRIEF:
Benjamin Clarke (ARGUED)
Deputy Attorney General
Richard J. Hughes Justice
Complex
CN 112
Trenton, New Jersey 08625
COUNSEL FOR APPELLEES
Honorable Daniel H. Huvett. 3rd. of the United States District
Court for the Eastern District of Pennsvlvania. sitting by designation.
A-3
OPINION OF THE COURT
PER CURIAM.
This is an appeal by Shelton College (a religious
institution located in New Jersey). church entities affili-
ated with Shelton College, Shelton College students and
parents, and a Shelton College facuity member from an
order of the district court refusing to permanently enjoin
the New Jersey State Board of Higher Education from
enforcing against Shelton College two provisions of New
Jersey's education law, N.J.S.A. 18A:68-3 and N.J.S.A.
18A:68-6, that require institutions of higher education in
New Jersey to be licensed by the state before they can
confer baccalaureate degrees. The district court held
that application of New Jersev’s degree licensing stat-
utes to a sectarian college whose religious doctrine pre-
cludes state licensure does not violate the first amend-
ment. We affirm.
This controversy between Shelton College and the
New Jersey State Board of Higher Education has
spawned almost two decades of litigation in the state and
federal courts. In 1966, in response to a resolution by the
New Jersey State Board of Education to terminate Shel-
ton College’s power to confer baccalaureate degrees be-
cause of its failure to comply with certain minimum
educational standards, Shelton College brought suit
against the Board in New Jersey state court. contending
that New Jersey’s degree licensing statutes infringed its
freedom of speech in violation of the first amendment.
The New Jersey Supreme Court certified an appeal and
upheld the constitutionality of the statutes. thereby
prompting the Board to revoke Shelton College’s license
to award degrees in New Jersev. Shelton College v. State
Board of Education, 48 N.J. 501, 226 A.2d 612 (1967).
In February 1979, the Board learned that Shelton Col-
lege intended to offer courses in New Jersey and to grant
degrees through its licensed Florida affiliate. Believing
that this practice violated New Jersey's education laws.
A-4
the Board brought suit against Shelton College in New
Jersey Superior Court to enjoin the college from engag-
ing in any educational instruction or granting degrees
until it obtained a New Jersey license. The Superior
Court granted a preliminary injunction to that effect.
In November 1979, Shelton College joined with
certain “federal only” plaintiffs, appellants herein, and
filed an action under 42 U.S.C. §1983 in the United
‘States District Court for the District of New Jersey seek-
ing to enjoin the Board from interfering with their right
to teach, advertise, and grant degrees without a New
Jersey license. The district court issued a preliminary
injunction, enjoining the Board, on first amendment
religion grounds, from preventing Shelton College from
engaging in religious teaching or educational activities
or from advertising those activities. It retained jurisdic-
tion of plaintiffs’ claim that the degree licensing statutes
violated the religion clauses of the first amendment
pending construction of the statutes by the New Jersey
state courts. New Jersey-Philadelphia Presbytery of the
Bible Presbyterian Church v. New Jersey State Board of
Higher Education, 482 F.Supp. 968 (D.N.J. 1980). This
court affirmed. New Jersey-Philadelphia Presbytery of
the Bible Presbyterian Church v. New Jersey State Board
of Higher Education, 654 F.2d 868 (3d Cir. 1981).
Meanwhile, in the separate state court action, the
New Jersey Superior Court held that New Jersey’s de-
gree licensing statutes were constitutional under the
first amendment religion clauses, and it permanently
enjoined Shelton College from awarding degrees until it
obtained a license. Shelton College and the “federal
only” plaintiffs then returned to federal district court
seeking to preliminarily enjoin the Board from imple-
menting that state court injunctive order pending review
by the New Jersey Supreme Court. The district court
granted a preliminary injunction. New Jersey-Philadel-
phia Presbytery of the Bible Presbyterian Church v. New
Jersey State Board of Higher Education, 514 F.Supp.
A-5
506 (D.N.J. 1981). The New Jersey Supreme Court
affirmed the Superior Court, holding that New Jersey's
degree licensing statutes applied to religious institutions
and that they were not unconstitutional under the reli-
gion clauses of the first amendment. New Jersey State
Board of Higher Education v. Board of Directors of
Shelton College, 90 N.J. 470, 448 A.2d 988 (1982). Based
on that decision, the district court below refused to make
permanent its preliminary injunction enjoining the
Board from enforcing New Jersey's degree licensing
statutes against Shelton College. Plaintiffs appealed.
Before us, appellants contend that the application to
Shelton College of New Jersey's degree licensing stat-
utes infringes upon their free exercise of religion and
creates an excessive state entanglement with religion in
violation of the religion clauses of the first amendment.
Appellees respond that because these constitutional
issues were fully. litigated in the New Jersey Supreme
Court, resulting in a final judgment prohibiting Shelton
College from conferring baccalaureate degrees without a
license, appellants are barred on res judicata grounds
from relitigating the issues in federal court. Alterna-
tively, appellees argue that New Jersey's degree licens-
ing statutes are constitutional under the first amend-
ment. 2
After due consideration of these contentions, and for
the reasons set forth in the district court opinion by the
Honorable Dickinson R. Debevoise, New Jersey-Phila-
delphia Presbytery of the Bible Presbyterian Church v.
New Jersey State 3oard of Higher Education, Civ. No.
79-3341 (D.N.J. July 29, 1983), reprinted in app. at 225.
we conclude that this action is not barred on res judicata
grounds and that New Jersev’s degree licensing statutes
pass constitutional muster.
A-6
Accordingly, the judgment of the district court will
be affirmed.
TO THE CLERK:
Please file the foregoing opinion.
Circuit Judge
A-7
APPENDIX B
IN THE
UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY
NEW JERSEY-PHILADELPHIA : Civil No. 79-3341
PRESBYTERY OF THE
BIBLE PRESBYTERIAN
CHURCH; SHELTON
COLLEGE, etc., et al., Transcript of
Plaintiffs, : Proceedings
vU. :
NEW JERSEY STATE BOARD
OF HIGHER EDUCATION,
etc., et al., .
Defendants. : Newark, New Jersey
July 29, 1983
BEFORE:
HONORABLE DICKINSON R. DEBEVOISE. U.S.D.]J.
Appearances:
(No appearances. )
THE COURT: What I intend to do is simply put an
opinion on the record and then reserve the right to take
the transcript of the opinion and correct it as needed.
The procedural history of this case first in this court
as reported in 482 F.Supp. 968 (1980) (Shelton I), then
in the Court of Appeals, reported in 654 F.2d 868 (1981)
(Shelton II), and then in this court again is described in
New jersey-Philadelphia Presbytery v. N.J.,514 F.Supp.
506, (D.N.J. 1981), (Shelton III). In Shelton Ill I set
forth reasons why the defendants should be preliminar-
ily enjoined from enforcing or implementing an order of
A-8
the Chancery Division of the New Jersey Superior Court
in the related state court action enforcing the application
of the New Jersey licensing statutes and regulations
against Shelton College until such time as the Supreme
Court of New Jersey construed the statute and regula-
tions.
The New Jersey Supreme Court directly certified the
case then pending in the State Superior Court. It held
that “the State’s program for licensing institutions of
higher education is applicable to sectarian institutions
and that faciaily it does not unduly interfere with the free
exercise of religion nor create an excessive state en-
tanglement with religion.” (N.J. Bd. of Higher Ed. v.
Shelton College, 90 N.J. 470, 490 (1982)). The Court,
however, modified the judgment of the Chancery Divi-
sion to allow the awarding of earned credits and degrees
to all eligible students through the end of the 1982-83
academic year, and to the class of 1984 through the end
of the 1983-84 academic year.
On January 10, 1983 a plenary trial of the instant
case was held. The State court trial testimony and ex-
hibits were made part of the record and each side called
one additional witness. I reserved decision giving the
parties additionai time to submit post trial briefs. I have
reviewed the entire record, the briefs, and conclude that
plaintiffs are not entitled to further relief.
The preliminary injunction entered in this case after
Shelton I need not be made final because the state courts
have ruled that the New Jersey licensing statutes and
regulations do not and were not intended to prevent
Shelton College from teaching or advertising. They do no
more than regulate the granting of formal degrees.
The remaining issues are whether the New Jersey
degree licensing statutes and regulatory scheme violate
plaintiffs’ First Amendment right to free exercise of their
religion, and whether the licensing system results in an
impermissible entanglement between government and
religious institutions. I conclude that in the peculiar
nae
A-9
circumstances of this case the decision of the New
Jersey Supreme Court on these issues is not res judicata
and binding upon the plaintiffs other than, perhaps,
Shelton College. I further conclude, however, that the
New Jersey statutes and regulatory scheme as explicated
by the New Jersey Supreme Court, pass Constitutional
muster.
Res Judicata Issue
In order to evaluate the defendants’ res judicata
claim, it is necessary to review certain of the procedural
steps in the case.
Before this case was instituted, the New Jersey State
Board of Higher Education had instituted an action in
the Chancery Division of the New Jersey Superior Court
to restrain Shelton College from operating without a
license. The defendants in that case were the board of
directors of Shelton College and two of its officers. On
the date the complaint was filed, the Superior Court
issued a temporary restraining order enjoining, with a
limited exception for certain students for a short period
of time, all educational or instructional activities and
advertising.
Shortly afterwards plaintiffs filed this action under
42 U.S.C., Section 1983, alleging that the efforts of the
Board to prevent Shelton’s educational and instructional
activities unless it complied with New Jersey’s licensing
scheme violated their rights to the free exercise of reli-
gion and unduly entangled the State in the affairs of a
religious institution.
Plaintiffs in the federal action were Shelton College,
New Jersey-Philadelphia Presbytery of the Bible Presby-
terian Church, the Bible Presbyterian Church of Collings-
wood, four Shelton College students, two parents of
Shelton College students, and a member of the Shelton
College faculty.
A-10
After an evidentiary hearing in the case I entered an
order which, among other things, enjoined the defend-
ants from taking or permitting the taking of any action
having the effect of preventing Shelton College from
engaging in any religious teaching or educational activi-
ties or from publicizing such activities. I did not reach
the principal issue, namely, whether the Board’s licens-
ing procedures, if applicable to Shelton College, would
constitute a violation of the religion clauses of the First
Amendment. I| abstained as to that issue and stayed the
federal proceedings until the State court had an oppor-
tunity to determine whether the licensing requirements
applied to a religious institution such as Shelton College.
If they did not, there would have been no need to reach
the difficult constitutional issue posed in this case. Rail-
road Comm’n against Pullman Co., 312 U.S. 496 (1941).
The defendants argue on the basis of Younger v.
Harris, 401 U.S. 37 (1971) and its progeny, that the
federal case should have been dismissed since there was
a pending state court proceeding started before this
action involving a matter of important state interest. I
stated in Shelton | that “if one were to accept the State
Board’s contention that all that is involved in this case is
a question whether the State Board has the power to
license Shelton and grant degrees and if there were no
attempt to shut down this teaching institution, it is my
opinion that both the Younger and the Pullman doctrines
would be applicable.” 482 F.Supp. at 976.
However, at that juncture in the state and federal
litigation the State Board was not simply seeking to deny
Shelton College the right to grant degrees. It sought to
prevent it from engaging in any teaching activities, dis-
rupting in the process the religious expression and prac-
tices of a community of believers. This, I concluded, was
such an egregious violation of First Amendment rights
that the case came under a recognized exception to the
Younger doctrine. The Younger doctrine of abstention
will not apply in extraordinary circumstances where
———x °° ° ° ° °°
a ad ed 0 a
be ERIE tied tog
A-11
there will be great, immediate and irreparable harm if
the federal court does not intervene. Further I concluded
that in the situation of a Pullman abstention, the abstain-
ing federal court should retain jurisdiction and may.
while the state proceedings are being completed, grant
such interim injunctive relief as may be necessary to
insure the protection of federal rights.
Upon granting the preliminary injunction referred
to above I abstained on both Younger and Pullman
grounds pending completion of the State court action.
As a general rule, when a federal court concludes
that it is required to abstain on Younger grounds, it will
dismiss the complaint, requiring the parties to pursue
their remedies and argue their federal claims in the state
court proceeding. Occasionally, however, instead of dis-
missing the complaint in a Younger situation, the federal
court will stay the federal proceeding, reserving jurisdic-
tion to grant such relief as may be required upon com-
pletion of the state proceeding. Williams v. Red Bank Bd.
of Ed., 662 F. 2d 1008, (3d Cir. 1981).
Both sides appealed the order granting injunctive
relief in part and denying such relief in part.
The Court of Appeals resolved the State’s Younger
abstention arguments on different grounds from those
upon which I relied. The majority opinion did not find
that “extraordinary circumstances” called for an excep-
tion to Younger abstention. Rather, it concluded that the
Younger doctrine was simply inapplicable because there
were parties in the federal action (churches, parents.
students and a teacher) who were not parties to the State
action and who had separate interests of their own.
“|. . nonparties to the state enforcement proceed-
ings who assert independent constitutional interests may
advance those interests in a separate federal action.
Since the interests of any of these plaintiffs alone are
sufficient to justify the Court’s consideration of the ap-
plication for a preliminary injunction, that order cannot
be reversed on the chief ground the Board advances,
A-12
absent a very great extension of the Younger rule . . .
Shelton II, 654 F.2d at 881.
Thus, to the extent that Shelton I ruled that the stay
of proceedings after issuance of the preliminary injunc-
tion was based on Younger grounds, its reasoning must
be considered to have been rejected by the majority
opinion in Sheltoz II.
On the other hand, the Court of Appeals upheld the
Pullman type stay with retention of jurisdiction to con-
sider further relief when the State court had construed
the statutes and regulations.
While the federal action was pending before the
Court of Appeals, the State court action was tried and
decided in the Chancery Division of the New Jersey
Superior Court in June, 1980. At that trial Shelton Col-
lege presented and argued its federal and constitutional
claims. The State plaintiffs in that case had abandoned
their original position that Shelton College could rot
teach or advertise without the imprimatur of a state
license and simply sought a ruling that Shelton College
could not grant degrees or call itself a college without
such a license. The State trial court held that the insti-
tution was entitled to designate itself a college, but
further held that the State licensing statutes precluded
Shelton College from granting degrees in New Jersey
without a license from the State Board of Higher Edu-
cation and that such a requirement did not violate the
United States Constitution.
After the decision in that case and after the decision
of the Court of Appeals in Shelton II, but before the
decision of the New Jersey Supreme Court, I issued the
Shelton III opinion in which I enjoined the State Board
of Higher Education from enforcing the order of the
Superior Court until such time as the New Jersey Su-
preme Court definitively construed the applicable New
Jersey statutes and regulations.
In August, 1982 the New Jersey Supreme Court
definitively construed the statute and regulations in a
A-13
comprehensive opinion referred to above. The Court
declined to follow the route that the United States Su-
preme Court followed in NLRB v. Catholic Bishops of
Chicago, 440 U.S. 490 (1979). There the Court avoided
the difficult question whether application of the National
Labor Relations Act to lay teachers employed by paro-
chial schools violated First Amendment religion clauses
by holding that the Act did not apply to religious schools.
The New Jersey Supreme Court, on the other hand,
concluded the New Jersey Statute, NJSA 18A:68-3 and
NJSA 18A:68-6, by their clear language and obvious’
intent applied to religious as well as’secular colleges.
Having so concluded, the Court turned to the constitu-
tional question whether the application of the statutes to
Shelton College unconstitutionally infringes upon plain-
tiffs’ free exercise of their religion.
The Supreme Court assumed for the purposes of
that case that plaintiffs’ religious beliefs prohibited Shel-
ton College from applying for and obtaining licensure by
the New Jersey Board of Higher Education. That was a
generous concession to the plaintiffs. The evidence
clearly establishes in both the State case and in the
federal case that in the past plaintiffs had no compunc-
tions about applying for licensure in New Jersey and
Florida. This assumed article of faith will be found nei-
ther in the Institutes of the Christian Religion nor in the
Westminster Confession nor in the Larger Catechism
nor = the Shorter Catechism. It derives from more
recent inspiration.
The New Jersey Supreme Court nevertheless ac-
cepted plaintiffs’ position in this regard and it recognized
that the New Jersey licensing statutes as applied to
Shelton College imposed some burdens on the exercise
of religion. However, it found that the legislation sup-
ports strong State interests, namely, maintenance of the
integrity of the baccalaureate degree in protecting stu-
dents as potential consumers of higher education. It
further found that granting a religious exemption from
A-14
licensing would significantly hinder attainment of these
State interests and thus application of the statute to
Shelton College does not constitute an abridgement of
the Free Exercise Clause of the First Amendment.
The Supreme Court further concluded that the stat-
utes have a secular purpose and their primary effect
neither advances nor inhibits religion and thus avoids
excessive entanglement with religion.
It is in the discussion of this issue that one discerns
how far removed is the position of the New Jersey
Supreme Court from the original position of the New
Jersey State Board of Higher Education which precipi-
tated the federal litigation.
The original position of the State Board, which was
accepted in the first instance by the Superior Court, was
that Shelton College, not having obtained a license, must
be shut down in toto and prohibited from teaching secu-
lar or religious subjects and prevented from publicizing
its existence and its teachings. The State Board in its
administration of the licensing statutes exhibited total
unawareness of First Amendment rights. It was this
circumstance which necessitated federal court interven-
tion. Were the statutes and regulations to be adminis-
tered in the spirit originally manifested by the State
Board, there is little doubt but that they would have had
to have been declared unconstitutional in their applica-
tion if not on their face.
Neither party in the present proceeding, however,
has emphasized sufficiently the totally different ap-
proach to the statutes and regulations taken by the
Supreme Court. The Court was fully aware of the deli-
cate balance that must be struck between compelling
state interests and the exercise of religious faith. Its
opinion made it very clear that the licensing statutes, as
they are applied to religious institutions, are to intrude as
little as possible upon the functioning of such institu-
tions. The pertinent paragraphs of the opinion can only
be construed as a gentle but unmistakable directive to
iad nt Pe aw
A-15
the State Board to apply the statutes and regulations in
a manner that will result in as little intrusion upon
religious colleges as possible.
Quoting from the opinion: “The establishment
clause permits minor unobtrusive State supervision of
religiously oriented schools. Only excessive entangle-
ment is proscribed. None of the education statutes or
regulations here in question mandate active involvement
of the sovereign in religious activity. None authorize the
state regulation of the contents of an educational pro-
gram, nor does the regulatory scheme on its face require
comprehensive, discriminating and continuing state sur-
veillance. Although the regulations in this area, NJAC
9:1-1 to 2.14 appear to be burdensome, especially as
applied to a college of approximately 30 students, they
explicitly call for flexibility of their administration so as
to accommodate various institutions with diverse educa-
tional goals, NJAC Title IX, Forward.
“Because Shelton College declined even to complete
the licensing process, the allegation of excessive en-
tanglement rests on speculation of the manner in which
those statutes and regulations might be applied. Al-
though one could imagine an unconstitutional applica-
tion of its regulatory scheme, we are confident the Board
of Higher Education will pursue the least restrictive
means to achieve the State’s overriding concerns.” 90
N.J. 488 to 490 (citations omitted).
On this basis the Court concluded that the statutes
and regulations did not create excessive state entangle-
ment with religion. Thus plaintiffs, by virtue of their
litigation in the State and federal courts, have effected a
very profound change in the manner in which the State
Board will deal with religious colleges in the future.
It is the State’s argument that both the statutory
interpretation and constitutional holdings of the New
Jersey Supreme Court are binding in the present federal
action.
A-16
Generally the principles of res judicata are appli-
cable in federal Section 1983 cases, that is, parties to the
Section 1983 action will be bound by determinations
against them on issues decided in the state court pro-
ceedings. Allen v. McCurry, 449 U.S. 90 (1980).
However, the Court of Appeals held in Shelton II
that the federal abstention in this case to allow comple-
tion of the State court proceeding is not a Younger
abstention, but rather properly a Pullman abstention.
In the case of such an abstention, the federal court
stays its hand in order to give the state courts an oppor-
tunity to decide state law questions, the determination of
which may make it unnecessary to reach the constitu-
tional question. Thus in the present case had the New
Jersey Supreme Court construed the licensing statutes
to exclude religious colleges, it would have been un-
necessary to have dealt with the constitutional issue.
In a Pullman abstention situation the federal plain-
tiffs are entitled to have their federal claims decided in a -
federal court once the state law claims are resolved in the
state court. However, this right will be lost if a litigant
unreservedly litigates his federal claims in the state
court. If he does that the may not return to the federal
court to relitigate his federal claim there. England v.
Louisiana Medical Examiners, 375 U.S. 411 (1964).
In the present case Shelton College did litigate its
federal claim in the state courts without reservation. Its
belated effort in the New Jersey Supreme Court to re-
serve those claims for the federal court hardly suffice to
overcome the England rule. Were the College the only
plaintiff in the federal case. I believe it should be held to
be bound by the New Jersey Supreme Court decision.
However, the College is not the only plaintiff in the
federal action. For the same reasons that the Court of
Appeals held in Shelton II that Younger principles were
not applicable, I conclude that the principle of res judi-
cata should not preclude the plaintiffs who appear only
a le eo
ribhahaatts Naas san Wichita
A-17
in the federal action from seeking a ruling on their
federal claims in this court.
First Amendment Religion Claim Issue
It is necessary, therefore, to determine whether the
New Jersey licensing statutes, as construed by the New
Jersey Supreme Court, violate plaintiffs’ First Amend-
ment religious rights.
The underlying facts are set forth in Shelton I, II and
III. There can be no question that Shelton College is a
religious institution in all phases of its activities. Plain-
tiffs, therefore, have stated a religious liberty claim, e.g.,
United States v. Ballard, 322 U.S. 78 (1944). It is quite
likely that Shelton College will not be able to survive if it
is unable to grant baccalaureate degrees. In the light of
the New Jersey Supreme Court decision, however, it is
not at all certain that Shelton College would be unable to
obtain a license to grant such degrees if it applied for
such a license. Unlike the New Jersey Supreme Court, I
do not assume the members of the Bible Presbyterian
Church and related fundamentalist religious groups are
forbidden by their faith to permit their colleges to apply
for state licensing. The evidence in this case is to the
contrary. Therefore, the question is not whether Shelton
College is being forced to do something its religious
tenets forbid. The question is whether the statute and
regulatory scheme involve an impermissible intrusion by
the State into the affairs of a religious institution.
Given the generally undisputed facts in this case, it
must be determined whether the impact of the State’s
statutes and regulations upon the religious interests of
the plaintiffs can be justified by a compelling state in-
terest in the regulation of a subject matter within the
State’s constitutional power to regulate. Sherbert v.
Verner, 374 U.S. 398 (1963).
Plaintiffs urge that the conditions for licensure im-
posed by the New Jersey statutes and regulations would
A-18
impose impermissible burdens upon plaintiffs’ religious
liberties. I refer to these burdens at some length in
Shelton Ill, 514 F. F.Supp., 512 to 513. Plaintiffs note
that the requirements contained on the Standards for
New Jersey Institutions of Higher Learning are not
specific in nature. Rather, they are written in very gen-
eral terms leaving broad discretion to the agency and
persons administering the licensing program. This,
plaintiffs argue, opens the way for total State regulation
of Shelton College’s religious ministry.
Defendants, on the other hand, urge that this very
flexibility of the regulations makes it possible for the
administrators of the licensing program to adapt the
regulations and standards to particular circumstances of
a religious institution.
The conclusion to be drawn is that whether this
licensing program impinges on religious liberties will
depend upon the manner in which the program is ad-
ministered.
Were the original attitude of the State Board of
Higher Education to guide the administration of the
licensing program to prevail, one might well have cause
for concern that Shelton College’s religious mission
would be impermissibly affected. However, the New
Jersey Supreme Court opinion not only demonstrates
complete awareness of the need to accommodate the
administration of the statutes and regulations to the
religious purposes of the College, it also constitutes a
gentle but firm direction of the Board of Higher Educa-
tion to pursue the State’s concern with these religious
considerations in mind. The Court noted that “Should
the Board exercise its discretion in a manner that un-
necessarily intrudes into Shelton’s religious affairs, the
college would then be free to challenge the constitution-
ality of such action.” 90 N.J. at 490.
In light of the Supreme Court's opinion I think it is
inconceivable that the State Board would seek to modify
in any way any statement of purpose which Shelton
.
=
3
§
-
a
A-19
College sets forth in a license application or attempt to
judge the appropriateness or lack of appropriateness of
such purpose. Further, I think one would now expect
the Board to make every effort to accommodate its re-
quirements to the religious beliefs and practices of Shel-
ton College and of its students, parents and teachers.
Much of the testimony and other evidence in the
State and federal court proceedings related to the ques-
tion of whether the State of New Jersey has a compelling
State interest in regulating the granting of degrees.
Plaintiffs urge that no such interest exists. They urge
that the quality of a bachelor’s degree or of any other
degree is dependent upon the quality of the institution
granting the degree, not upon State regulations. They
noted the depreciation of the integrity of the degree, a
factor to which I alluded in Shelton III, 514 F.Supp..
514.
However, even plaintiffs’ witnesses attested to the
importance of maintaining the quality of higher educa-
tion and the degrees evidencing attainment of such
education. It is a subject in which the State has a
compelling interest. Even though the imposition of li-
censing requirements has not assured uniformly high
quality education in all institutions of higher learning,
the State is certainly justified in pursuing that goal.
The extent to which the attainment of this goal
would be jeopardized by absolute exemption of religious
colleges from any form of degree licensing requirements
is illustrated by the case of State ex rel McLemore v.
Clarksville School of Theology, 636 S.W. 2d 706, (Sup.
Ct. of Tenn. 1982). The Clarksville School of Theology,
a totally religious institution, had not complied with the
requirements of the Tennessee Higher Education Com-
mission promulgated pursuant to statutory authority.
The Attorney General brought an action to enjoin the
school from granting degrees until it met the require-
ments of the statute.
A-20
The evidence established that for a bachelor’s degree
an applicant must first have faith, second, be a pastor or
evangelist, and third, must complete a “synthetic” Bible
study and write a thesis of 30,000 words. A bachelor of
theology degree cost $25 at enrollment, $320 tuition, and
$30 for a cap and gown. Students were required to
attend only three seminars, that being the only class-
room attendance required. Without the granting of de-
grees, the students at the institution would not have
attended.
The School defended the case on very much the
same grounds that Shelton College advances here. The
Tennessee Supreme Court held the granting of degrees
is purely a secular activity, and that was the only activity
the State sought to regulate, leaving the school free to
believe, practice and teach as it thought fit. It found
neither a burden upon the free exercise of religion nor a
threat of entanglement between the affairs of church
and state.
If the award of a degree is to have any significance
whatsoever, criteria such as those established by Clarks-
ville School of Theology cannot be permitied to serve as
a basis for a degree.
Even more bizarre examples of degree criteria can
be conjured up if religious institutions are totally ex-
empted from all regulations of degree granting activities.
I believe the State does have a compelling interest in
preventing the impairment of minimum standards for
the granting of degrees and protecting the gullible and
the unwary.
True, the licensing process imposes some burden on
a religious institution such as Shelton College which
conducts its educational program in a manner which
qualifies its students for a degree in the traditional sense.
However, in light of the manner in which the New
Jersey Supreme Court has directed that the statute and
regulations be applied to a religious college, | conclude
the burden is not undue.
A-21
Further, in light of the New Jersey Supreme Court’s
directions in this regard, it cannot be held that the
statutes and regulations on their face involve an undue
entanglement with religion within the principles of Walz
v. Tax Commission of New York, 397 U.S. 664 (1969),
and Roemer v. Maryland Board of Public Works, 426
U.S. 736 (1976). It is possible, of course, that the licens-
ing scheme could in fact be administered in a manner
which would intrude unduly upon religious matters, but
it should not be assumed the State Board will disregard
the directions of New Jersey’s Supreme Court or that the
Courts would fail to rectify the situation if it did.
CONCLUSION
This case has run a long course.
At the outset the New Jersey Board of Higher Edu-
cation sought to enforce New Jersey’s degree licensing
statutes and regulations by shutting down Shelton Col-
lege and preventing it from teaching and advertising. It
had obtained a state court order to that effect.
In light of the Board’s lack of awareness of funda-
mental constitutional rights evidenced by the sanctions
it sought, it takes only a little imagination to predict the
manner in which the Board would have applied the
licensing statutes and regulation to Shelton College at
that time. One could safely have predicted that the Board
would have been unaware of the great care which would
have been required to avoid impinging upon the reli-
gious liberties of the plaintiffs.
The plaintiffs prevailed at the outset in the federal
action obtaining a preliminary injunction restraining the
Board from shutting down the College and from limiting
its rights to advertise its activities.
In several respects plaintiffs have prevailed in the
State courts. Both the trial court and the Supreme Court
recognized that on both statutory and constitutional
grounds the State lacks the power to shut down Shelton
A-22
College or to limit in any way its teacning or religious
activities. All the State has the power to do is to prohibit
Shelton College from granting degrees unless it com-
plies with the licensing program. Although the New
Jersey Supreme Court held that the statutes and regu-
lations apply to religious institutions, it made it abun-
dantly clear that in administering the statutes and regu-
lations the State Board must take into account and
accommodate plaintiffs’ religious beliefs and practices.
Thus, one can confidently expect that the State Board’s
administration of the licensing program will reflect these
directions.
in light of these developments the preliminary in-
junction issued in this court is no longer required and
will be vacated.
In light of my conclusion that New Jersey may
regulate the granting of degrees by religious colleges in
a manner specified by the New Jersey Supreme Court,
further relief in the federal action will be denied. Judg-
ment will be entered for defendants without costs.
Notwithstanding the entry of judgment for defend-
ants, plaintiffs are clearly the prevailing parties for the
purposes of the Civil Rights Attorney’s Fee Award Act,
42 U.S.C. Section 1988. They succeeded in obtaining
relief on the merits in the form of a preliminary injunc-
tion preventing the State from closing Shelton College
and ordering it to cease teaching and advertising. Fol-
lowing its obtainment of this relief, plaintiffs were able to
persuade the State courts that the State did not have the
power to close Shelton College even though is was un-
licensed. Further, as a result of plaintiffs’ actions, the
New Jersey Supreme Court rendered an opinion which
established the State Board of Higher Education obliga-
tion to administer the degree licensing statutes and
regulations with due regard to the religious nature of
Shelton College.
Therefore, if the parties cannot agree to an appro-
priate amount of attorneys’ fees, plaintiffs should file an
A-23
updated application for fees, bearing in mind the prin-
ciples set forth in C. Duane Hensley v. Thomas Eck-
erhart, 51 U.S. Law Week 4552, (U.S. Supreme Cit.
1983) and N.A.A.C.P. v. Wilmington Medical Center,
Inc., 689 F.2d 1161, (3rd Cir. 1982).
The defendants will be requested to submit a form of
judgment consistent with this opinion.
All right. Thank you very much. That will resolve it.
A-24
IN THE
UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY
NEW JERSEY-PHILADELPHIA : Civil No. 79-3341
PRESBYTERY OF THE
BIBLE PRESBYTERIAN
CHURCH, SHELTON
COLLEGE, et al.,
Plaintiffs, : ORDER
vU. .
NEW JERSEY STATE BOARD
OF HIGHER EDUCATION,
et al.,
Defendants.
Plenary trial of this matter having been held on
January 10, 1983, and post-trial briefs having been sub-
mitted, and the court having considered all the evidence
and legal arguments set forth by the parties, and it
appearing for the reasons set forth in this court’s bench
opinion of July 29, 1983, that plaintiffs are not entitled to
declaratory or injunctive relief beyond that awarded in
this court’s opinion and order.of January 4, 1980,
IT IS on this 26th day of September 1983 OR-
DERED and ADJUDGED that no further relief being
warranted in this action judgment shall be entered for
the defendants and the complaint shall be dismissed
with prejudice and without costs;
A-25
Further ORDERED and ADJUDGED that plaintiffs
having prevailed on the merits at the preliminary injunc-
tion proceeding after which defendants abandoned cer-
tain of their original positions as to the meaning and
effect of the New Jersey degree licensing statute, plain-
tiffs may make application to the court for an award of
attorneys fees pursuant to 42 U.S.C. § 1988 after making
a good faith effort to reach agreement with defendants as
to an appropriate amount of such award.
DICKINSON R. DEBEVOISE
U.S.D.J.
A-26
APPENDIX C
SUPREME COURT OF NEW JERSEY
A-138 September Term 1981
THE NEW JERSEY STATE BOARD OF HIGHER
EDUCATION and T. EDWARD HOL-
LANDER, CHANCELLOR OF THE NEW
JERSEY DEPARTMENT OF HIGHER EDU-
CATION,
Plaintiffs-Respondents,
VU.
THE BOARD OF DIRECTORS OF SHELTON
COLLEGE, GLENN ROGERS and CARL MclI-
NTIRE,
Defendants-Appellants.
Aruged March 8, 1982 — Decided August 9, 1982
On certification to the Superior Court, Chancery
Division.
William Bentley Ball, a member of the Pennsylvania
bar, argued the cause for appellants (Bashaw &
Burro, attorneys; Mr. Ball, Philip J. Murren, Kath-
leen A. O’Malley and C. Clark Hodgson, Jr., mem-
bers of the Pennsylvania bar, of counsel; Keith J.
Bashaw and C. Peter Burro, on the brief).
Robert A. Fagella, Deputy Attorney General, argued
the cause for respondents (Irwin I. Kimmelman,
Attorney General of New Jersey, attorney; Erminie
L. Conley, Assistant Attorney General, of counsel).
Michael F. Spicer submitted a brief on behalf of
amicus curiae The Association of Independent Col-
leges and Universities of New Jersey (Jamieson,
McCardell, Moore, Peskin & Spicer, attorneys; Mr.
Spicer and Laura C. Ford, on the brief).
ee ee ee ee re
A-27
Garrett M. Heher submitted a brief on behalf of
amicus curiae Council of County Colleges (Smith,
Stratton, Wise & Heher, attorneys; Mr. Heher and
Thomas E. Kopil, on the brief).
The opinion of the Court was delivered by O’'HERN,
bE
Two provisions of New Jersey’s education law,
N.J.S.A. 18A:68-3 and N.J.S.A. 18A:68-6, prohibit the
conferring of baccalaureate degrees by any institution
that has not secured a license from the State Board of
Higher Education. We hold that application of these
statutes to a sectarian college whose religious doctrine
precludes state licensure does not violate the First
Amendment.
I.
Shelton College is an institution of higher education
operated by the Bible Presbyterian Church as part of the
church’s religious mission. Members of this fundamen-
talist Christian church believe that every aspect of their
lives, including education, must be governed by their
faith. Shelton’s teachers and students believe that their
presence at the college is for the purpose of preparing
themselves and others to undertake missions that their
Lord calls upon them to perform. Religion pervades
Shelton College. Every academic subject is taught from
a Christian fundamentalist perspective and students
must conform their behavior to religiously derived codes
of conduct. Shelton College is a school of approximately
30 students, but those who attend it cherish its mission.
The procedural pilgrimage of Shelton College to this
point of decision began after the school opened opera-
tions in New Jersey in the 1950’s under a temporary
license issued by the State. In 1965, the State Board of
Education passed a resolution proposing to terminate
Shelton’s power to confer baccalaureate degrees because
the college had failed to comply with certain minimum
A-28
requirements. Shelton appealed the Board’s action, chal-
lenging the constitutionality of N.J.S.A. 18A:68-3 and
N.J.S.A. 18:68-6, the statutes that regulate the award of
baccalaureate degrees. Shelton College v. State Bd. of
Ed., 48 N.J. 501 (1967) (Shelton I). Specifically, Shelton
asserted that (1) any state regulation of baccalaureate
degrees abridges the right of free speech guaranteed by
the New Jersey and Federal Constitutions; (2) the li-
censing statute effected an overbroad delegation of leg-
islative power to an administrative agency, in violation of
the New Jersey Constitution; and (3) the legislation
deprived Shelton of equal protection of law because it
contained limited exemptions for institutions that had
the authority to confer academic degrees prior to 1887.
Id.
The Court upheld the statutes against Shelton’s
constitutional attacks and affirmed the action of the
State Board of Education. Central to the Court’s decision
was its discussion of the bachelor’s degree and the State’s
interest in preserving the degree’s integrity. Chief Jus-
tice Weintraub carefully traced the history of New Jersey
legislation relating to the granting of baccalaureate de-
grees, and concluded that
... it is the degree, evidential as it is of academic
attainment, which especially is an approporiate ob-
ject of regulation. . . . “The power to confer academic
degrees is to be regarded as distinct and separate
from the privilege of being incorporated as an edu-
cational institution. The privilege of granting de-
grees is very intimately related to the public welfare,
and is unquestionably subject to regulation by the
State.”
[Shelton I, supra, 48 N.J. at 511, quoting Elliott,
The Colleges and the Courts (1936) p. 200].
Thus, Shelton I held that the State has a substantial
interest in regulating the bachelor’s degree and that it
A-29
may constitutionally prohibit the granting of such de-
grees by unlicensed institutions.
In 1971, after Shelton I and the conclusion of related
litigation, In Re Shelton College, 109 N.J. Super. 488
(App. Div. 1970), the State Board of Higher Education
revoked Shelton’s temporary license to award degrees in
New Jersey. Shelton College moved its operations to
Florida where it obtained a license to confer bachelor’s
degrees in that state. It has continued to operate there up
to the present time and, as late as May 1981, applied to
Florida officials for renewal of its license.
In February of 1979, Shelton College submitted a
new application to the New Jersey State Board of Higher
Education, seeking authorization to award baccalaure-
ate degrees in Biblical Literature, Christian Education,
Elementary Education, Secondary Education, English,
History, Business Management, Music Education and
Natural Science. Before it secured such authorization,
however, Shelton began to offer credit-bearing courses
in New Jersey that it represented would lead to a
bachelor’s degree. On November 15, 1979, the State
Board of Higher Education brought suit in the Superior
Court, Chancery Division, alleging that Shelton’s New
Jersey operations violated N.J.S.A. 18A:68-3 and N.J.S.A.
18A:68-6 which prohibit the conferring of degrees or the
furnishing of instruction for the purpose of conferring
degrees, except by licensed institutions. The State Board
sought an injunction restraining Shelton from engaging
in any form of educational instruction, offering any cred-
its, or granting any degrees until it obtained a license
authorizing it to do so. The Chancery Court granted a
preliminary injunction to that effect.
On November 19, 1979, Shelton College and various
students and faculty members instituted an action under
42 U.S.C. §1983 in the United States District Court for
the Districi of New Jersey. The federal plaintiffs alleged
that application of the New Jersey licensing statutes to
Shelton College violated rights guaranteed them by the
A-30
First, Ninth and Fourteenth Amendments to the United
States Constitution. They sought both declaratory and
injunctive relief.
The District Court issued a preliminary injunction,
enjoining the State from taking any action to prevent
Shelton College from engaging in religious teaching or
educational activities, or from publicizing or advertising
these activities.' Although the court granted partial in-
junctive relief to the federal plaintiffs, it abstained from
deciding whether the New Jersey licensing statutes ap-
ply to religious institutions, such as Shelton College. The
District Court stayed the federal action to permit the
state courts to resolve this issue.
In February 1980, the State Board appealed the
District Court’s order to the United States Court of
Appeals for the Third Circuit, and the fededral plaintiffs
cross-appealed. While the federal appeal was pending,
the state court action proceeded to trial in June 1980. At
this trial Shelton College presented its federal constitu-
tional claims. The Superior Court upheld the constitu-
tionality of the licensing statutes as applied to Shelton
College and on December 10, 1980 entered a permanent
injunction which, among other things, restrained the
college from awarding course credits or degrees in New
Jersey without a license from the State Board of Higher
Education. Shelton filed notice of appeal to the Appellate
Division.
On April 14, 1981, a divided Third Circuit upheld
the Federal District Court’s order granting injunctive
relief, and approved the court’s decision to stay further
federal proceedings pending completion of the state court
action. On May 18, 1981, the District Court entered a
revised preliminary injunction that prohibited the State
Board of Higher Education from enforcing or implement-
ing the Superior Court’s order of December 10, 1980,
1. The Superior Court subsequently modified its preliminary
order to conform with the federal court’s preliminary injunction.
A-31
“until such time as the Supreme Court of New Jersey
definitively construes the New Jersey statutes and regu-
lations which are the subject of this action.” New Jer-
sey-Philadelphia Presbytery of the Bible Presbyterian
Church v. New Jersey State Board of Higher Education,
514 F. Supp. 506, 515 (1981). We directly certified the
matter on petition of the parties. ___N.J. ___(1981).?
Il.
Before addressing the constitutional issues raised by
this appeal, we first consider whether N.J.S.A. 18A:68-3
and N.J.S.A. 18A:68-6 apply to religious institutions such
as Shelton College. Read literally, these statutes clearly
encompass Shelton College. They require that all insti-
tutions — regardless of religious character or affiliation
— obiain a license before offering degree programs or
conferring degrees. Nonetheless, defendants urge us to
adopt a narrowing construction of these statutes — ex-
cluding Shelton from their ambit — so as to avoid the
constitutional issues that otherwise would emerge. De-
fendants suggest that this result could be achieved by
employing a standard of statutory construction an-
nounced by the United States Supreme Court in NLRB
v. Catholic Bishop of Chicago, 440 U.S. 490, 59 L. Ed. 2d
533 (1979). In that case the court declared that any
interpretation of a statute that “would give rise to serious
constitutional questions” must be rejected unless the
construction is compelled by “the affirmative intention of
the Congress clearly expressed.” Id. at 501, 59 L. Ed. 2d
2. We do not pass upon the complex problems of federalism
presented by the movements of the parties between state and
federal courts. Those issues divided the appeals panel in this case,
NJ. Phila. Presbytery v. NJ. State Bd., 654 F. 2d 868 (1981). Cf.
Middlesex Ethics Committee v. Garden State Bar Association et al.,
U.S. (1982) (federal courts should abstain from interfering
with ongoing disciplinary proceedings where proceedings provided
attorney under investigation with adequate opportunity to present
constitutional claims).
A-32
at 541. Applving this standard, the Court held that the
National Labor Relations Act does not extend to lay
teachers employed by parochial schools, even though the
act’s general terms include such employees. The Court
concluded that application of the National Labor Rela-
tions Act to church-operated schools would implicate the
Religion Clauses of the First Amendment but that there
existed no affirmative expression of legislative intent
sufficient to compel the constitutionally troublesome
interpretation of the act.
Four dissenting justices assailed the Court’s opin-
ion, stating that the majoritv had “seemingly invented
...acanon of statutorv construction . . . for the purposes
of deciding this case.” The dissent would have adhered
to the principle of statutory construction set out in Ma-
chinists v. Street, 367 U.S. 740, 6 L. Ed. 2d 1141 (1961):
“When the validity of an act of Congress is drawn in
question, and even if a serious doubt of constitution-
ality is raised, it is a cardinal principle that this Court
will first ascertain whether a construction of the
statute is fairly possible by which the question may
be avoided.” Crowell v. Benson, 285 US 22, 62, 76 L
Ed 598, 619.
(Id. at 749, 750. 6 L. Ed. 2d at 1150 (emphasis
added )}.
The dissent concluded that
... {Whhile the resolution of the constitutional ques-
tion is not without difficulty, it is irresponsible to
avoid it by a cavalier exercise in statutorv interpre-
tation which succeeds onlv in defving congressional
intent. A statute is not “a nose of wax to be changed
from that which the plain language imports. . . .” Yu
Cong Eng v. Trinidad. 271 US. at 518. 70 L Ed 1059.
46 S Ct 619.
A-33
[NLRB v. Catholic Bishop of Chicago, supra,
440 U.S. at 518, 59 L. Ed. 2d at 552}.
Under New Jersey law, a challenged statute will be
construed to avoid constitutional defects if the statute is
“reasonably susceptible” of such construction. State v.
Profaci, 56 N.J. 346, 350 (1970); Woodhouse v.
Woodhouse, 17 N.J. 409, 416 (1955). Thus, our standard
for construing statutes of uncertain constitutionality
closely resembles the principle of construction advo-
cated by the dissent in Catholic Bishop. But even if we
were to accept the broader standard elaborated by the
Catholic Bishop majority, we would still be constrained
to find that the New Jersey licensing statutes apply to
Shelton College.
The Legislature’s intent with regard to these stat-
utes is clear and unambiguous. N.J.S.A. 18A:68-3 and
N.J.S.A. 18A:68-6 speak in absolute terms. They prohibit
the granting of baccalaureate degrees by any institution
that has not secured a license from the State Board of
Higher Education. The sole exception to this regulatory
scheme appears in N.J.S.A. 18A:68-6. There the Legis-
lature expressly exempted institutions that were operat-
ing on April 1, 1887 by virtue of special legislative grant.
See L. 1912, c. 315; Shelton I, supra, 48 N.J. at 507. No
such exemption was created for sectarian colleges. Nor
does the legislative history even hint at an intent to
exclude religious schools from the scope of these stat-
utes. To the contrary, the history of the higher education
licensing provisions demonstrates a legislative intent to
regulate the conferring of baccalaureate degrees by re-
ligious as well as secular institutions. See Id. at 509-16.
The first higher education “approval” statute, en-
titled “An Act to prescribe the terms and conditions
under which degrees may be conferred by any school or
institution of learning within this State,” was adopted in
1912. L. 1912, c. 315. This legislation did not, however,
A-34
mark the State’s first involvement with the bachelor’s
degree. Prior to 1912 the Legislature passed several
special acts of incorporation that authorized a number of
secular and sectarian institutions to confer baccalaure-
ate degrees. Passage of these acts evidenced the
Legislature’s belief that even a sectarian college’s power
to confer degrees could be conditioned on state authori-
zation. There is no reason to infer that the Legislature’s
view in this regard changed before passage of L. 1912, c.
315. We must assume therefore that when the Legisla-
ture adopted L. 1912, c. 315, it was aware of the exist-
ence of religiously oriented colleges. We must also as-
sume that the Legislature understood that such institu-
tions would come within the literal terms of the statute.
Yet, although the act included an express exemption
clause, it contained no exemption for religious colleges.
Related provisions of New Jersey education law sup-
ply further evidence of legislative intent. Thus N.J.S.A.
18A:68-2 provides that seminaries and schools of theol-
ogy may grant bachelor’s degrees “subject to the provi-
sions of this chapter.” (Emphasis added.) This statute
appears in Chapter 68 of the education laws, together
with the licensing statutes.
The current statutory scheme also confirms that the
Legislature affirmatively intended to regulate the con-
ferring of degrees by religious institutions. In 1966, the
Legislature created a Department of Higher Education,
the office of Chancellor of Higher Education, and a
Board of Higher Education. L. 1966, c. 302, §§1, 2 (see
now N.J.S.A. 18A:3-1, -6, -20). The Board has been given
broad authority over the system of higher education in
this State. N.J.S.A. 18A:3-13. See, Association of New
Jersey State College Faculties v. Dungan, 64 NJ. 338
(1974). Pursuant to N.J.S.A. 18A:3-13, it is the duty of
the Board “to advance long-range planning for the sys-
tem of higher education as a whole in the State.” (Em-
phasis added.) Religious oriented colleges and universi-
ties comprise a significant proportion of the institutions
a
A-35
of higher learning in this State. If such institutions were
permitted to reject even minimal state regulation, the
legislative intent manifested by these education laws.
would be defeated.
Finally, the practice relative to N.J.S.A. 18A:68-3
and N.J.S.A. 18A:68-6 has been to apply the licensing
requirements to all degree-granting institutions, regard-
less of religious affiliation. The Legislature has acqui-
esced in this long-standing practice. This is strong evi-
dence that the current application of these statutes con-
forms to legislative intent. See, Division ef Taxation v.
Body-Rite, ___N.J. ___(1982).
In summary, we see no basis to infer that the Leg-
islature intended te exempt Shelton College and like
institutions from the requirements of N.J.S.A. 18A:68-3
and N.J.S.A. 18A:68-6. We construe statutes in accord
with the Legislature’s intent, even if to do so will give rise
to substantial constitutional questions. We hold that
N.J.S.A. 18A:68-3 and N.J.S.A. 18A:68-6 apply to Shel-
ton College.
III.
We turn now to defendants’ claim that application of
N.J.S.A. 18A:68-3 and N.J.S.A. 18A:68-6 to Shelton Col-
lege unconstitutionally infringes upon the free exercise
of their religion. Decisions in cases such as this regret-
tably involve courts in an examination of religious prac-
tices and inevitably call for “a delicate balancing of
important but conflicting interests.” Wisconsin v. Yoder,
406 U.S. 205, 237, 32 L. Ed. 2d 15, 38 (1972) (White, J..
concurring). In this case we must decide whether the
State’s interest in regulating academic degrees constitu-
tionally justifies the burden that such regulation may
impose on defendants’ freedom to hold and practice their
religious beliefs.
We begin by determining whether application of the
statutory licensing requirements to Shelton College in-
A-36
terferes with the free exercise of defendants’ religion.
Defendants profess as a principle of their faith that the
Bible commands the separation of church and state.
Recently, the Bible Presbyterian Church interpreted this
religious precept as prohibiting Shelton College from
submitting to licensure by the New Jersey Board of
Higher Education. We note, however, that defendants
did apply for renewal of Shelton’s Florida license subse-
quent to their espousal of this scriptural interpretation.
Although the First Amendment wisely prohibits
courts from questioning the validity of religious beliefs,
United States v. Ballard, 322 U.S. 78, 88 L. Ed. 1148
(1944), it does not preclude judicial inquiry into the
sincerity of those who claim exemption on religious
grounds from a law of general application. Id. Despite
defendants’ apparently inconsistent adherence to the
asserted religious tenet, however, we decline to inquire
into their sincerity on the record before us. Rather, we
shall assume, for purposes of this appeal, that licensure
of Shelton College would conflict with a principle of
defendants’ religion.
Accepting this assumption, the Board of Higher Edu-
cation nonetheless maintains that application of N.J.S.A.
18A:68-3 and N.J.S.A. 18A:68-6 to Shelton College does
not abridge defendants’ Free Exercise rights. The Board
points out that even if enforcement of those statutes
against Shelton causes the college to close, no direct
interference with religious practice occurs because de-
fendants’ religion does not require attendance at Shelton
Collge.
This argument undervalues the constitutional right
to exercise one’s religion freely. The First Amendment
guarantee of religious freedom protects against more
than direct state proscription of religious practices. See,
e.g., Cantwell v. Connecticut, 310 U-S. 296, 84 L. Ed.
1213 (1940). Any state action that unduly burdens the
free exercise of religion violates the First Amendment.
Thomas v. Review Bd. Indiana Emp. Sec. Div., 450 U.S.
A-37
707, 67 L. Ed. 624 (1981); Wisconsin v. Yoder, supra.
406 U.S. at 220, 32 L. Ed. 2d at 28; Sherbert v. Verner.
374 U.S. 398, 404; 10 L. Ed. 965, 970 (1963). Even
facialiy neutral legislation may give rise to a burden on
religion if, as applied to a particular religious sect. it
forces individuals to choose between abandoning their
religious beliefs or sacrificing an important government
benefit.
Where the state conditions receipt of an important
benefit upon conduct proscribed by a religious faith
or where it denies such a benefit because of conduct
mandated by religious belief, thereby putting sub-
stantial pressure on an adherent to modify his be-
havior and to violate his beliefs, a burden on religion
exists.
[Thomas v. Review Bd. Indiana Emp. Sec. Div..
supra, 405 U.S. at 717-18, 67 L. Ed. 2d at 634).
In Thomas a Jehovah’s Witness refused on religious
grounds to accept work building weapons. Indiana offi-
cials rejected Thomas’ application for unemployment
compensation, ruling that he had failed without good
cause to accept employment and was therefore ineligible
to receive benefits. Thus, Indiana’s unemployment com-
pensation law effectively forced Thomas to choose be-
tween his faith and financial benefits that he may well
have needed to subsist. The Supreme Court held that
imposition of this choice violated the Free Exercise
clause of the First Amendment.
In an analogous manner, N.J.S.A. 18A:68-3 and
N.J.S.A. 18A:68-6 require defendants to choose between
a tenet of their religion and the privilege of conferring
baccalaureate degrees. Clearly the dilemma that New
Jersey’s education law poses for defendants is not as
cruel or coercive as was the choice thrust upon Thomas
by the Indiana Unemployment Compensation Act.
Nevertheless, we must conclude that the New Jersey
A-38
licensing statutes, as applied to Shelton College, impose
some burden on the exercise of religion.
This conclusion does not, however, terminate the
inquiry. Not all burdens on religion are unconstitutional.
United States v. Lee, ___U.S. ___., 71 L. Ed. 2d 127
(1982). Prince v. Massachusetts, 321 U.S. 158, 88 L. Ed.
645 (1944); Smith v. Ricci, 89 N.J. 514 (1982). Legis-
lation that impedes the exercise of religion may be con-
stitutional if there exists no less restrictive means of
achieving some overriding state interest.* Thus, in
United States v. Lee, supra, the Court held that although
the Amish believe it sinful not to provide for their own
elderly and needy and therefore are religiously opposed
to the national social security system, they must never-
theless withhold, report and pay social security taxes on
their employees. The Court said:
The conclusion that there is a conflict between
the Amish faith and the obligations imposed by the
social security system is only the beginning, how-
ever, and not the end of the inquiry. Not all burdens
on religion are unconstitutional. The state may jus-
tify a limitation on religious liberty by showing that
it is essential to accomplish an overriding govern-
mental interest.
[United States v. Lee, supra, ___U.S. at __
—, 71 L. Ed. 2d at 132 (citations omitted)].
3. Arecent Federal Court of Appeals decision, Bob Jones Univ.
v. U.S., 639 F. 2d 147, 153 (4th Cir. 1980), cert. granted __—iUS..,
more fully explicated this standard.
Assuming that the revocation of [tax exempt] status does
impinge upon the university’s practice to some extent the
question remains one of balancing — giving due consideration
to the weight of the interests asserted by the government and
the extent and nature of the burden on the religious practice
and the religion as a whole.
A-39
The legislation at issue here advances the State’s
interest in ensuring educational standards and maintain-
ing the integrity of the baccalaureate degree. Chief Jus-
tice Weintraub amply described the depth and impor-
tance of this interest from medieval times to the present
in Shelton I, supra, 48 N.J. at 510-15. We need not
reconstruct that discussion here. That Court’s views may
be summarized:
Whatever the reason for the modest governmen-
tal activity in this area, it was not for doubt as to the
power of the States to act. In Trustees of Dartmouth
College v. Woodward, 4 Wheat. 518, 634, 4 L. Ed.
629, 658 (1819), in which the charter of incorpora-
tion was held to be a contract the State could not
undo, Chief Justice Marshall said, in axiomatic style:
“That education is an object of national con-
cern, and a proper object of legislation, all ad-
mit.” [48 N.J. at 510-11].4
Shelton’s education expert testified that the
bachelor’s degree has been severely devalued by recent
trends in education and that therefore the State cur-
rently has no significant interest in regulating the award
of such degrees. Other educators have earnestly urged
the contrary. In their amicus brief to this Court, the
4. The Court recalled that the Supreme Court of Vermont
refused to imply in a general charter the power to confer degrees,
saying in Townshend v. Gray, 62 Vt. 373, ___, 19 A. 635, 636, 8
A.L.R. 112, ___ (1890):
* * *To hold that the legislature, by a general law, in-
tended that any three men in any town in the state, however
illiterate or irresponsible, might organize and flood the state
with doctors of medicine, doctors of law, docivi; uf divinity,
masters of arts, civil engineers, and all the other various titles
that everywhere in the civilized world have signified high
attainments and special equipment for professional work, is to
liken it to the witty French minister who threatened to create so
many dukes that it would be no honor to be one, and a burning
disgrace not to be one.
A-40
Association of Independent Colleges and Universities of
New Jersey° maintained that “there is a general expec-
tation that institutions permitted to award degrees in this
State will at least meet basic standards of educational
integrity.” Amicus stressed the importance of maintain-
ing the value and integrity of academic degrees, and
expressed the fear that, if such degrees are permitted to
erode in value, “if there no longer can be a presumption
of minimum standards — then students, educational
institutions and the public will be harmed.”
In addition, the legislation supports the State’s pur-
pose of protecting students, as potential consumers of
higher education, from substandard education. It allows
them to assume by virtue of a school’s ability to grant
degrees that it meets certain minimum standards.
That maintenance of minimum educational stand-
ards in all schools constitutes a substantial state interest
is now beyond question. See, e.g., Wisconsin v. Yoder,
supra; Lemon v. Kurtzman, 403 U.S. 602, 29 L. Ed. 2d
745 (1971); Pierce v. Society of Sisters, 268 U.S. 510, 69
L. Ed. 1070 ,1925). Nothing in this record persuades us
to the contrary. The Legislature has attached great im-
portance to the fulfillment of these goals. We have no
doubt of that legislative appraisal and conclude that the
New Jersey licensing statutes are supported by a strong
state interest in maintaining minimum academic stand-
ards and preserving the basic integrity of the baccalau-
reate degree.
Having reached this conclusion, we must now de-
cide whether granting defendants a religious exemption
from the licensing statutes would significantly hinder
attainment of the state interest. If so, the statutes present
the least restrictive means of fulfilling an overriding
governmental interest and, as such, do not abridge de-
5. The Association of Independent Colleges and Universities of
New Jersey is a membership organization composed of sixteen
private nonprofit institutions of higher education. Ten of its member
institutions have religious affilations.
os) im AR a
ta A
Psd Tat an Ree CARRE Hey RAMPARTS ae SE LIA ENE
Saal tk: alah ae as
es
A-4]
fendants’ rights of religious freedom. U.S. v. Lee, supra,
set ae Mh cis Th i ee, Swe 133.
In New Jersey, the conferring of a baccalaureate
degree connotes that certain minimum standards have
been met by the issuing institution, and that the degree
recipient has attained at least a basic level of academic
proficiency. To this extent the value of academic degrees
from New Jersey institutions traces directly to state
regulation. Thus, by claiming a complete exemption
from all state regulation defendants in effect ask that
they be given a benefit without having to accept the
correlative burden. In this sense, if the First Amendment
requires that Shelton be permitted to confer degrees
without a license, it must also require that unemploy-
ment compensation be disbursed to individuals who for
religious reasons refuse to accept any employment what-
soever. Sherbert expressly warned that the First Amend-
ment compels no such result. Id., 374 U.S. at 409-10; 10
L. Ed. 2d at 974.
Sherbert, Thomis and Yoder all hold that religious
exemptions from neutral legislation must be provided
where uniform enforcement of the legislation will un-
duly impinge upon the exercise of religion. But, as the
Court in U.S. v. Lee, supra, recognized, the First Amend-
ment does not require the provision of religious exemp-
tions where accommodation would significantly inter-
fere with the attainment of an overriding state interest.
Such a requirement, the Court observed, would “radi-
cally restrict the operating latitude of the Legislature.”
Id. at___, 71 L. Ed. 2d at 134 (quoting Braunfield v.
Brown, 366 U.S. 599, 606, 6 L. Ed. 2d 563, 568 (1961)).
Commentators have observed that it is when the reli-
gious exercise does “not materially affect the working of
the secular program” that the free exercise claim is
recognized. Freund, “Public Aid to Parochial Schools,”
82 Harv. L. Rev. 1680 (1969). See also Clark, “Guide-
lines for the Free Exercise Clause,” 83 Harv. L. Rev. 327
(1969). Here, accommodation of defendants’ religious
A-42
beliefs would entail a complete exemption from state
regulation. As noted above, such accommodation would
cut to the heart of the legislation and severely impede the
achievement of important state goals. Furthermore, if an
exemption were created here, Shelton College would
receive an advantage at the expense of those educational
institutions that have submitted to state regulation. Such
a development would undermine the integrity of the
baccalaureate degree, erode respect for the state higher
education scheme, and encourage others to seek exemp-
tions. Thus, the uniform application of these licensing
requirements is essential to the achievement of the
State’s interests. See Braunfield v. Brown, supra (state
interest in uniform day of rest constitutionally justifies
refusal to create religious exemptions to Sunday closing
law). See also U.S. v. Lee, supra, ___U.S. at ____, 71 L.
Ed. 2d at 135-36 (Stevens, J., concurring).
In sum, although defendants’ freedom of religion
may suffer some indirect burden from this legislation,
the constitutional balance nonetheless favors the state
interest in uniform application of these higher education
laws. As the U.S. Supreme Court noted,
When followers of a particular sect enter into
commercial activity as a matter of choice, the limits
they accept on their own conduct as a matter of
conscience and faith are not to be superimposed on
the statutory schemes which are binding on others
in that activity.
ius. v. Lee, cupre, 0S. & ., 71 L. Ed.
2d at 134-35].
We conclude that N.J.S.A. 18A:68-3 and N.J.S.A.
18A:68-6 2s applied to Shelton College do not abridge
rights guaranteed by the Free Exercise Clause of the
First Amendment.
The Establishment Clause requires that a law reflect
a secular legislative purpose, have a primary effect that
A-43
neither advances nor inhibits religion, and avoid exces-
sive entanglement with religion. Committee for Public
Education and Religious Liberty v. Regan, 444 U.S. 646,
63 L. Ed. 2d 94 (1980); Committee for Public Education
v. Nyquist, 413 U.S. 756, 37 L. Ed. 2d 948 (1973); Marsa
v. Wernik, 86 N.J. 232 (1981); Resnick v. E. Brunswick
Tp. Bd. of Ed., 77 N.J. 88 (1978). The secular purpose of
the State’s program for higher education is unassailable.
Defendants assert, however, that this reguiatory scheme
creates an excessive state entanglement with religion.
The United States Supreme Court has never ques-
tioned a state’s interest in insuring, through licensure or
accreditation, minimal academic standards in church-
operated institutions.® See, e.g., Pierce v. Society of Sis-
ters, supra. As stated in Lemon v. Kurtzman, supra:
We... have surveillance over sectarian schools but
only to the extent of making sure that minimum
educational standards are met, viz, competent teach-
ers, accreditation of the school for diplomas, the
number of hours of work and credits allowed, and so
on. ... Any surveillance to date has been minor and
has related only to the consistently unchallenged
6. Some state courts have invalidated comprehensive state
licensing or approval powers over private religious schools where, as
one court said, the minimum standard scheme was “so pervasive
and all-encompassing that total compliance with each and every
standard by a non-public school would effectively eradicate the
distinction between public and nonpublic education.” State v. Wis-
ner, 47 Ohio. St. 2d 181, 351 N.E. 2d 750 (1976). See also, Kentucky
State Board for Elementary and Secondary Education v. Rudasill,
589 S.W. 2d 877 (Ky. 1979), cert. denied, 446 U.S. 938 (1980) (court
based its decision on section 5 of the Kentucky Constitution, which
states shat “[n]o man [shall] be compelled to send his child to any
school to which he may be conscientiously opposed. . . .”); State v.
LaBarge, 134 Vt. 276, 357 A. 2d 121 (1976) (truancy). But see Bob
Jones University v. United States, supra, and Brown v. Dade
Christian Schools, 556 F. 2d 310 (5th Cir. 1977), cert. den., 434 U.S.
1036, where religious belief in racial discrimination conflicts with
governmental policy.
A-44
matters of accreditation of the sectarian school in
the State’s school system.
[403 U.S. at 631, 29 Lyfd. 2d at 766 (Douglas,
J., concurring) (emphasis supplied)].
The Establishment Clause permits minor, unobtrus-
ive state supervision of religiously oriented schools. Roe-
mer v. Maryland Public Works Bd., 426 U.S. 736, 49 L.
Ed. 2d 179 (1976). Only excessive entanglement is pro-
scribed. None of the education statutes or regulations
here in question mandates “active involvement of the
sovereign in religious activity.” Walz v. Tax Commis-
sioner, 397 U.S. 664, 668; 25 L. Ed. 2d 697, 701 (1970).
None authorizes state regulation of the content of an
educational program. Nor does the regulatory scheme on
its face require “comprehensive, discriminating and con-
tinuing state surveillance.” Lemon v. Kurtzman, supra,
7. In order to determine the nature of an institution, the State
Board requires a statement of educational purpose, N.J.A.C. 9:1-1.2.
The institution is then required to show that its various elements
(faculty work, educational program, student life, finances, physical
plant, organization and administration) are organized in a way
supportive of this purpose. N.J.A.C. 9:1-1.2(b)(2). The institution
must develop a long-range plan for implementing its goals, as well
as periodically review its purpose and plans. N.J.A.C.
9:1-1.2(b)(3),(4); N.J.A.C. 9:1-1.3(a)(1). It is also required to con-
duct its affairs in a financially prudent manner, for its own protec-
tion and the protection of its students, creditors and other citizens.
N.J.A.C. 9:1-1.4. The maintenance of legitimate financial records
and insurance protection are intended to “assure the continuity of
the institution.” See N.J.A.C. 9:1-1.4(b). The regulations also rec-
ognize the importance of an adequate library. N.J.A.C. 9:1-1.8.
There are suggested standards for admission to the institution. For
example, the regulations propose that normally a high school di-
ploma should be required. N.J.A.C. 9:1-1.9(b)(1). Adequate and safe
physical facilities are also required. N.J.A.C. 9:1-1.10. In any areas
where standards are proposed, however, no rigid mandates are
maintained. Paragraph 5 of the Foreword to Title 9 of the New
Jersey Administrative Code expresses this policy:
The standards specify desirable and acceptable practices
which further implement the good intentions of the law but are
ene te ai att SAS
Din ae atin arent Diario theta
eda aren us FO cae
A-45
403 U.S. at 619, 29 L. Ed. 2d at 759. Although the
regulations in this area, N.J.A.C. 9:1-1 to -2.14, appear to
be burdensome, especially as applied to a college of
approximately 30 students, they explicitly call for flex-
ibility in their administration so as to accommodate vari-
ous institutions with diverse educational goals.* N.J.A.C.,
Title 9, Foreword. Because Shelton College declined
even to complete the licensing process, the allegation of
excessive entanglement rests on speculation about the
manner in which these statutes and regulations might
be applied. Although one could imagine an unconstitu-
tional application of this regulatory scheme, we are con-
fident that the Board of Higher Education will pursue
the least restrictive means to achieve the State’s overrid-
ing concerns. Of course, should the Board exercise its
discretion in a manner that unnecessarily intrudes into
Shelton’s religious affairs, the college would then be free
to challenge the constitutionality of such action. At this
juncture, however, we need not invalidate these statutes
merely because they may be amenable to an unconsti-
tutional application.
. It has not been the Court’s practice, in consid-
ering facial challenges to statutes of this kind, to
strike them down in anticipation that particular ap-
plications may result in unconstitutional [action].
not required in a specific form so that institutional flexibility
may be maintained. . . .
8. The licensing procedures also engender a high degree of
flexibility. Pursuant to N.J.A.C. 9:1-2.4 the Licensure and Approval
Advisory Board is composed of seven representatives from various
state and county colleges and universities, three representatives of
the Association of Independent Colleges and Universities in New
Jersey (AICUN!), three persons representative of colleges not mem-
bers of AICU NJ and one representative of the Department of Higher
Education. The Board makes recommendations to the Chancellor
regarding policies for licensure and specific petitions for licensure.
N.J.A.C. 9:1-2.7. Participation in the licensing process by this di-
verse group representing both public and private institutions, seeks
to ensure practicality in the administration of the program.
A-46
[Roemer v. Maryland Public Works Bd., supra,
426 U.S. at 761, 49 L. Ed. 2d at 196}.
See Village of Hoffman Estates v. Flipside Hoffman
Estates Inc., ve. : L. Ed. 2d (1982);
I/M/O Application of Maria Martin, N.J.
(1982).
V.
In sum, we find that the State’s program for licens-
ing institutions of higher education is applicable to sec-
tarian institutions and that facially it does not unduly
interfere with the free exercise of religion nor create an
excessive state entanglement with religion. At the same
time, we recognize the good faith with which the stu-
dents of Shelton College have pursued their educational
and religious goals. To accommodate the free exercise
interests of the individual students without unduly in-
terfering with the state regulatory program, and in con-
sideration of the difficulty involved in transferring to a
different college at the end of three years, we modify the
judgment below to allow the awarding of earned credits
and degrees to all eligible students through the end of
the 1982-83 academic year and to the class of 1984
through the end of the 1983-84 academic year. No other
credits or degrees shall be awarded without licensure.
As modified, the judgment of the Chancery Division
is affirmed.
Chief Justice Wilentz and Justices Pashman, Clif-
‘ford, Schreiber, Handler and Pollock join in this opinion.
A-47
APPENDIX D
Second Opinion and Order of the United States District
Court for the District of New Jersey, dated May 18, 1981
UNITED STATES DISTRICT COURT
District oF New JERSEY
Civil Action No. 79-3341
>
> a
NEW JERSEY-PHILADELPHIA PRESBYTERY OF
THE BIBLE PRESBYERTIAN CHURCH; SHELTON
COLLEGE, A Ministry of Bible Presbyterian Church;
BIBLE PRESBYTERIAN CHURCH OF COLLINGS-
‘ WOOD, NEW JERSEY: KEVIN WILSON, BRAD
GSEL, KEVIN CLAIR MICHAEL, CURTIS JORDAN
BASHAW, LOUISE OLSON and EVERETTE CHAR-
LES OLSON,
Plaintiffs,
Lf
NEW JERSEY STATE BOARD OF HIGLER EDUCA-
TION; T. EDWARD HOLLANDER, Chancellor of New
Jersey Department of Higher Education; RICHARD D.
BRESLIN, <Assistant Chancellor for Academic Affairs
; of the New Jersey Department of Higher Education;
; and AMORITA SUAREZ, Director of the Office for
: Independent Colleges and Universities of the New Jersey
Department of Higher Education,
Pe eae
i
Defendants.
A-48
OPINION
Desevoise, District Judge.
Appearances:
William B. Ball, Esquire
Philip J. Murren. Esquire
Kathleen A. O’Malley. Esquire
Ball & Skelly, Esquires
511 North Second Street
P.O. Box 1108
Harrisburg, Pennsrlvania 17108
C. Clark Hodgson, Jr.. Esquire
Stradlev, Ronon, Stevens & Young, Esquires
1100 One Fraklin Plaza
Philadelphia. Pennsylvania 19102
Keith J. Bashaw, Esquire
Bashaw & Burro. P.C.
30th South Haddon Avenue
P.O. Box 5S
Haddonfield. New Jersey OS055
(Attorners for Plaintiffs)
James R. Zazzali. Esquire
Attorney General of New Jersey
Br: Robert A. Fagella, Esquire
Deputy Attorney General
State House Annex
Trenton, New Jersey 08625
(Attornevs for Defendants)
A-49
This is an application by plaintiffs for a temporary
restraining order and preliminary injunction.
Procedural History
An understanding of the procedural history of this
ease and its related state court case is necessary in order
to address the merits of plaintiffs’ application.
On November 15, 1979 the New Jersey State Board
of Higher Education and T. Edward Hollander, Chan-
cellor of the New Jersey Department of Higher Educa-
tion, instituted an action in the Superior Court of New
Jersey, Chancery Division, naming as defendants The
Board of Directors of Shelton College and Glenn Rogers
and Carl McIntire. two officers of the College. The com
plaint sought declaratory and injunctive relief, alleging
that Shelton was offering courses of instruction for credit
without the requisite licensing by the State Board. The
Superior Court forthwith issued a temporary restraining
order enjoining Shelton’s educational and instructional
activities.
On November 19, 1979 the plaintiffs in the present case
filed in this Court an action under 42 U.S.C. § 1983 al-
leging, among other things, that the efforts of the State
Board to prevent Shelton’s educational and instructional
activities unless it complied with New Jersey’s licensing
scheme violated their rights to the free exercise of reli-
gion and unduly entangled the State in the affairs of a
religious institution. The plaintiffs in the federal court
action are Shelton, the New Jersey-Philadelphia Presby-
tery of the Bible Presbyterian Church (the regional rul-
ing body of the Bible Presbyterian Church), Bible Pres-
6 A-50
brterian Church of Collingswood. New Jersey. four full-
time students at Shelton. two parents of students. and a
professor of mathematics and chemistry at Shelton. The
defendants in the federal court action are the State Board
and several individual state officials charged with the en-
forcement of the licensing regulations.
The federal plaintiffs sought a preliminary injunction.
After an evidentiary hearing I entered an order which,
among other things, enjoined the federal defendants from
taking or permitting the taking of any action having the
effect of preventing Shelton from engaging in any reli-
gious, teaching or educational activities. or from pub-
licizing or advertising such activities. I did not reach
the principal issue, namely. whether the State Board's
licensing procedures. if applicable to Shelton. would con-
stitute a violation of the Religion Clauses of the First
‘Smendment. I abstained as to that issue and stayed the
federal proceedings until the state court had an oppor-
tunity to determine whether the licensing requirements
applied to a religious institution such as Shelton. If
ther do not, there would be no need to reach the difficult
constitutional issue posed in this case, Railroad Comm'n
v. Pullman Co., 312 U.S. 496 (1941).
Thereafter, the litigation proceeded on two fronts. Both
sides appealed this Court’s interlocutory order, which
both granted and denied injunctive relief, to the Court of
Appeals for the Third Circuit. The state court action
went to trial.
On November 7. 1980 the state court rendered its opin-
ion. The opinion held: (i) subjecting Shelton to the New
Jersey licensing and approval scheme is “not violative of
the free exercise clause and provide[s] for minimal and
non-excessive entaiglement between church and state”
and (ii) Shelton’s rights of free speech. guaranteed un-
der the First and Fourteenth Amendments of the Consti-
tution. would be impaired if the court denied Shelton the
right to call itself a “College”, notwithstanding the pro-
hibitory language of N.J.S.A. 1S.4 :67-2.
The state court issued a permanent injunction on De-
cember 10. 1980. It prohibited Shelton from awarding a
degree “for any coursework or course of instruction which
has transpired in whole or in part at Shelton College in
the State of New Jersey”: it declared that Shelton must
obtain a license from the State Board before it awards
any collegiate degrees in New Jersey: it required that
Shelton delete all references in its publications which
state that Shelton will award collegiate degrees until it
it licensed by the State Board: and it ordered that Shel-
ton “shall cause to be inserted in all applications for ad-
mission to Shelton College a statement that. pursuant to
the order of this Court. said institution is prohibited from
awarding baccalaureate or collegiate degrees for course-
work which takes place in whole or in part in the State
of New Jersey, unless or until a license is issued to de-
fendants by the New Jersey State Board of Higher Edu-
cation”.
On January 16, 1981, Shelton and the other state court
defendants noticed an appeal to the Appellate Division
of the Superior Court of New Jersey. That appeal is
pending.
On April 14, 1981 the Court of Appeals for the Third
Circuit filed its opinion. Docket Nos. 80-1253, 80-1254 and
80-2703. The majority opinion held that Younger absten-
tion, Younger v. Harris, 401 U.S. 37 (1971), is inapplic-
A-52
able in this case by reason of the presence of plaintiffs
in the federal action who were not parties to the state
action. Thus, this Court’s limited injunctive relief was
proper. The Court of Appeals upheld a Pwlman absten-
tion on the constitutional issue and the entry of a Pull-
man-type stay “with a retention of jurisdiction to con-
sider further injunctive relief when the state court con-
strues the statute and regulations”. Slip Op., 38. In
affirming this Court’s exercise of its discretion to abstain
under the Pullman doctrine, the Court of Appeals noted,
perhaps pointedly, that “the district court did not leave
the plaintiffs entirely unprotected. It reserved jurisdic-
tion to consider further applications for interim relief.”
Slip Op., 38-40.
The federal plaintiffs now seek such interim relief. It
is their contention that the state court has interpreted
New Jersey’s college licensing statutes in a manner which
violates their First Amendment religious rights, that the
injunctive order implementing this determination of the
state court will, unless set aside, cause the demise of
Shelton College, a religious institution, and that if the
federal plaintiffs are required to wait until the state ac-
tion proceeds through the Appellate Division of the New
Jersey Superior Court, the New Jersey Superior Court.
the New Jersey Supreme Court and perhaps the United
States Supreme Court, ultimate success would be hollow
indeed, as the re:igious institution they sought to preserve
would long have been interred.
The federal] plaintiffs now seek a temporary restraint
and a preliminary injunction restraining the federal de-
fendants from enforcing or implementing the state court’s
order of December 10, 1980 until such time as the Su-
A-53
preme Court of New Jersey definitively construes the
applicable New Jersey statutes and regulations.
Findings of Facts
I incorporate herein the findings of fact which are set
forth in my original opinion, 482 F. Supp. 968 (D.N.J.
1980). I do not believe that they are in dispute. It was
established that Shelton is a religious institution and
that its students, faculty and parents regard it as a veh-
icle to further their all-pervasive religious beliefs and
practices.
Additional facts have been established by affidavits and
testimony introduced in support of the } Samora plaintiffs’
present application.
During the pendency of these actions in the state and
federal courts Shelton has been unable to grant degrees
to students who have completed the academic require-
ments of the College. The disclaimer which Shelton is
required under the state court order to insert in al] its
publications and on all application forms sent to pros-
pective students has a highly destructive impact upon
everything else which appears in those publications. There
is nothing to suggest that the publications do not truth-
fully describe the kind of education which Shelton offers
and the religious orientation of every phase of its pro-
gram. There is nothing to suggest that, absent the state
mandated material, any prospective parent or student
would be mislead in any way about Shelton’s educational
program.
After attempting to operate in Florida for a period
of approximately eight years, Shelton returned to its
A-54
Cape May campus in the summer of 1979. During the
1979-80 school year it began operations with 2S students.
This increased to only 41 to 35 students in the 1980-81
school vear. Moreover, as of the present time it has only
six applicants for its fall, 1981 freshman class. none of
whom have yet been determined to be qualified for ad-
mission. It is reasonable to conclude that in part, at
least, the College’s enrollment has been adversely affected
by the inhibitions imposed upon it by the State.
Shelton has experienced a steady drop in the amount
of contributions it receives from the public since the time
of the institution of the state court action. The pending
state litigation, the inability of the College to grant its
degrees, the disclaimer the College is required to issue
and resulting adverse publicity have resulted in loss of
confidence in the ability of the College to survive.
It is impossible to determine whether Shelton would
survive if the State injunction were lifted; however, there
is little question but that Shelton cannot long exist if
the state court injunction remains in effect.
In addition to Shelton’s future prospects, its present
students have been affected by the state court injunction.
At the graduation in May, 1980, four students who had
completed four years of study at Shelton in Florida and
New Jersey were denied their degrees. Shelton’s annual
commencement exercise is scheduled for May 23, 1981.
On that date eight students who have successfully com-
pleted four years of study at the College and who have
been determined by the College to possess the religious
and moral qualifications requisite for graduation will be
eligible to be awarded Shelton’s Bachelor of Arts in
Biblical Literature, Elementary Education, History or
A-55
English. By reason of the court decree, of course. these
indicia of their work at Shelton cannot be conferred upon
them.
The question must now be answered whether the fed-
eral plaintiffs are entitled to the relief they seek.
Conclusions of Law
First I shall direct myself to the grounds which the
federal defendants (who I shall hereinafter refer to as
the “State Board”) advance as comity reasons why the
application should not be granted. »
Once again the State Board urges that Younger absten-
tion is called for. This argument has been disposed of
by the Court of Appeals. There the majority opinion
concluded that Younger is not applicable at all because
the parties in the federal action are substantially differ-
ent from the parties in the state action. The minority
opinion concluded that Younger is applicable but that a
Younger-based exception supported the limited injunctive
relief previously granted in this Court. If the federal
plaintiffs are correct in their view that New Jersey may
not constitutionally apply its licensing requirement to
Shelton, I conclude that the same Younger-based excep-
tion would be applicable to the present application.
The State Board also urges that the federal plaintiffs
have fully litigated both their state claims and their fed-
eral claims in the state court, and that, having lost there
on all claims, they cannot come back to the federal court
for a second bite at the apple.
It is unnecessary to decide whether Shelton took the
steps required in the case of a Pullman abstention to re-
A-56
serve its rights in the state court litigation to mave its fed-
eral claims heard by the federal court, see England vy. Lou-
tsiana State Board of Medical Examiners, 375 U.S. 411
(1964). Quite likely the reasoning of the Court of Ap-
peals majority opinion would lead to the conclusion that
reservation or non-reservation of federal rights by the
state court defendants would not affect the rights to a
federal forum of the federal plaintiffs who are not par-
ties to the state court action. In any event, this is a
question which will not arise until the state court pro-
ceedings have been completed through final appeal, and
then only if there still remains a federal question.
We are not at that stage now. We are dealing simply
with an application for interim relief pending completion
of the state proceedings. The Court of Appeals spe-
cifically recognized that such relief might be required and,
if so, that it could appropriately be granted, Slip Op.,
39-40.
The criteria to be applied in determining whether a
preliminary injunction should issue are spelled out in the
Court of Appeals opinion:
... Once the court has concluded that an immediate
dismissal on Younger grounds is inappropriate, a
motion for preliminary injunctive relief, especially
in first amendment contexts, ought, we think, to be
considered without regard to the separate ques-
tion whether a Pullman stay of final hearing is
appropriate. Assuming the case is not to be dis-
missed outright, the district court should be guided
by the classic requirements for a preliminary in-
junction:
A-57
The traditional standard for granting a prelim-
inary injunction requires the plaintiff to show
that in the absence of its issuance he will suffer
irreparable injury and also that he is likely to
prevail on the merits.
Slip Op., 39.
The federal plaintiffs have established that they will
suffer irreparable injury if the state court injunction
continues in effect. It will result in the destruction of a
religicus educational community. At the time I issued
the preliminary injunction now in effect, I had thought
that this result could be avoided if Shelton were allowed
to teach and advertise. It now appears that this is not
enough and that if Shelton is to survive it must be able
to award degrees to those who successfully complete its
courses of instruction.
The major issue to be resolved is whether the fed-
eral plaintiffs are likely to prevail on the merits. The
core question, therefore, is whether the State Board’s
exercise of licensing jurisdiction over a religious college
such as Shelton “constitutes an improper breaching of
the separation wall provided by the Religion Clauses of
the First Amendment”. Catholic Bishop of Chicago v.
N.L.R.B., 559 F.2d 1112, 1118 (7th Cir. 1977), aff’d, 440
U.S. 490 (1979).
I have read with care the thoughtful opinion of the
state court and fully recognize my own fallibility, of
which the Court of Appeals all too frequently reminds
me. Had I been required to reach the merits of this is-
sue at the time I issued the preliminary injunction I think
I would have decided the question in exactly the same
way the state court decided it. However, with the bene-
fit of the Court of Appeals opinion. which was not avail-
able to the state court, I have considered the matter fur-
ther and. for the reasons set forth below. I have concluded
that the State Board mar not. consistent with the First
and Fourteenth Amendments, apply the State's licensing
satutes and regulations to Shelton College and that. there-
fore, the federal plaintiffs are likely to prevail on the
merits.
We start, of course, with the First Amendment to the
United States Constitutior, which reads, in relevant part.
that “Congress shall make no law respecting an estab-
lishment of religion, or prohibiting the free exercise there-
of ...” This is made applicable to the states by the
Fourteenth Amendment. Walz v. Tax Commission, 397
U.S. 664 (1970): Engel v. Vitale. 370 U.S. 421 (1962):
Everson v. Board of Education, 330 U.S. 1 (1946).
While the licensing of religious colleges and the regu-
lation which that entails might be considered involve-
ment by the state in the establishment of religion, the
present case involves primarily a state prohibiting the
free exercise of religion. Deciding whether this inter-
ference with the free exercise of religion is permissible
entails the three-step inquiry utilized in Wisconsin v.
Yoder, 406 U.S. 205 (1972); see also McCormick v. Hirsch,
460 F. Supp. 13837 (M.D. Pa. 1978S): (i) It must be de-
termined whether legitimate religious belief is held by
the federal plaintiffs and whether Shelton is pervasively
religious. (ii) It must be determined whether the free
exercise rights of the federal plaintiffs would be either
burdened or inhibited by the exercise of the State Board's
regulatory powers over Shelton College. (iii) It must
be determined whether the burdening of these rights is
justified by a compelling state interest.
As to the first inquiry, it is beyond dispute that the
individual federal plaintiffs and the members of the Bible
Presbyterian Church and similar fundamentalist churches
hold legitimate religious beliefs which are reflected in their
life style and teaching. This is described in some de-
tail both in my original opinion and in the opinion of
the Court of Appeals.
Similarly, it beyond dispute that Shelton College plays
a major role in the religious life of the members of
the Bible Presbyterian Church. As was the case with
Amish educational practices which were the subject of
Yoder, Shelton provides its students and faculty a “way
of life in a church-oriented community, separated from
the outside world and ‘wordly’ influences”. At 217. As
in the case of parochial schools. which were the sub-
ject of such cases as Jleek v. Pittenaer. 421 U.S. 349
(1975), and Lemon v. Aurtzman, 403 U.S. 602 (1971),
Shelton’s “very purpose ... is to provide an integrated
secular and religious education: the teaching process is,
to a large extent, devoted to the inculeation of religi-
ous value and belief... ‘[{T]he secular education these
schools provide goes hand in hand with the religious
mission that is the only reason for the schools’ exist-
ence’”. Meek v. Pittenger, supra, at 366. Although the
line of cases typified by Meek and Lemon involve aid
to religious schools, the same standards apply when state
restrictions upon religious schools are involved, Catholic
Bishop of Chicago v. N-L.R.B., supra.
In addition to providing a community where persons
of a defined religious group can live, learn and teach
in accordance with their tenets, Shelton is a source of
the church's clergy and lay leaders. It feeds students
A-60
to the church’s seminary, and its students who do not
become ordained ministers are likely to work on behalf
of the church in other capacities.
Shelton’s pervasively religious nature is described in
further detail in my original opinion.
Thus, the federal plaintiffs meet the first test. They
and their co-religionists hold legitimate religious beliefs
and their college, Shelton, is pervasively religious.
As to the second test, it is clear, in light of the evi-
dence submitted at the original hearinf and at the most
recent hearing, that the exercise of the federal plain-
tiffs’ religion would be and is burdened by application
of the State’s licensing requirements. The New Jersey
regulatory scheme (N.J.S.A. 1SA:68-1, et seqg.; N.J.A.C.
9:1-1.1 to 9:1-6.4) is described in some detail in the Third
Circuit opinion, Slip op., 8-13. The State Board’s “Guide
for Obtaining the Basic Information for Appraising New
Jersey Institutions of Higher Education” is set forth in
an appendix to that opinion. An examination of the
Guide demonstrates the intrusive nature of the State
Board’s inquiry into a college which it seeks to “ap-
praise” and license. The Court of Appeals observed that
“(t]he regulations are, in a word, pervasive”. It noted
that of particular relevance to a religiously affiliated in-
stitution is the regulation dealing with the required state-
ment of institutional purpose:
The requirement of a statement of purpose is
not merely informational, for the regulation deal-
ing with educational programs provides that ‘[t]he
educational program shall reflect and support the
purposes of the institution’ and ‘shall include course
work and other activities extending over a suffi-
A-61
cient period of time and in sufficient intensity to
fulfill the purposes of the institution.’ N.J.A.C.
9:1-1.5(a) 1, 2.
Thus*on the face of the regulations it would ap
pear that in order to obtain a license, an institu-
tion with a religious commitment such as Shelton’s
must submit to the Board a statement of its re-
ligious purpose, as well as evidence that the various
elements of its institutional life are structured to
support that purpose, and must submit to the
Board’s judgment the question whether its edu-
cational program reflects and supports that pur-
pose. Facially, therefore, the Board’s licensing
regulations suggest a very high degree of state
entanglement in Shelton’s religious affairs. And
the 1916 law unambiguously prohibits instruction
Jeading to a diploma or degree, even in theology,
absent a license.®
8. Cf. NLRB +. Catholic Bishop of Chicago,
440 U.S. 490, 502-03 (1979) (NLRB jurisdiction
over alleged unfair labor practices in Catholic re-
ligious schools would result in impermissible en-
tanglement, for the Board’s resolution of unfair
labor practices charges ‘will necessarily involve
inquiry into the good faith of the postion asserted
by the clergy-administrators and its relationship to
the school’s religious mission.’ Moreover, NLRB
determination of the ‘terms and conditions of em-
ployment‘ would enmesh the Board in ‘nearly every-
thing that goes on in the schools.’).
Slip Op., 12, 13.
A-62
Apart from the subject matter covered by the regula-
tory scheme, compliance with its requirements imposes
heavy burdens. The typical college could be expected
to have on its staff the accountants, business managers
and other technical personnel required to develop and
present the information called for by the State Board’s
regulations. Shelton obviously does not have these re-
sources. The New Jersey courts have recogized in analo-
gous circumstances that a regulatory scheme cannot witbh-
stand a constitutional challenge when it exerts a sub-
stantially chilling effect upon the exercise of First Amend-
ment mghts of persons whose resources are so modest that
they cannot reasonably be expected to comply with the
regulations, V.J. St. Chamber of Commerce v. N.J. Elec.
Law, 155 N.J. Super. 251 (App. Div. 1977).
As phrased by the United States Supreme Court, “[e]ach
value judgment under the Religion Clauses must there-
fore turn on whether particular acts in question are
intended to or interfere with religious beliefs and prac-
tices or have the effect of doing so”. Walz v. Tax Com-
mission, supra, 669 (emphasis added).
Clearly, application of the State licensing regulations
to Shelton has the effect of interfering with the religious
beliefs and practices of members of the Bible Presby-
terian Church ana other similar fundamentalist churches.
Lf Shelton could survive under such regulation and sought
to comply therewith, the State would intrude pervasively
into matters of religious faith and practice. As matters
stand, it appears that Shelton cannot survive at all if
New Jersey’s licensing statutes and regulations are ap-
plied to it. In either event substantial religious mghts
are affected. It is not an answer to assert that Bible Pres-
byterians are not required to attend Shelton. In each
A-63
case, however, attendance is a means of strengthening,
teaching and propagating a religious faith, and, in conse-
quence, the institution is protected from undue state in-
terference.
As an embellishment to the State regulatory scheme,
and as a means to insure compliance with it, the state
court has required that all Shelton informational material
and applications contain a statement that Shelton is pro-
hibited from awarding baccalaureate or collegiate degrees
for coursework in New Jersey unless or until a license is
issued to Shelton by the State Board. This order was
entered apparently with no proof that the state defeud-
ants (Shelton, et al.) were misrepresenting their degree-
giving capabilities or any other matters. It clearly im-
posed an additional burden on the ability of Shelton to
operate and thus on the exercise of religious rights.
“(T]he right of freedom of thought protected by the
First Amendment against state action includes both the
right to speak freely and the right to refrain from speak-
ing at all.” Wooley v. Maynard, 430 U.S. 705 (1977).
Standing alone, this aspect of the state court’s order
raises serious constitutional questions. Viewed in con-
junction with the regulatory scheme it seeks to enforce,
it adds significantly to the burdens imposed upon the free
exercise of religion.
Having concluded that the licensing scheme imposes a
substantial burden upon the exercise of religion, it must
be determined if this burdening of rights is justified by
a compelling state interest.
The interest of the State involved in the licensing scheme
is a significant and totally legitimate one—maintaining
the integrity of the various degrees traditionally awarded
by colleges by insuring compliance with minimum stand-
A-64
ards in the educational process leading to the award of
a degree, Shelton College v. State Bd. of Ed., 4S N.J. 501
Important as this interest may be, however, it cannot
be used as a basis to impose substantial burdens upon the
exercise of religion. The weighing process is guided by
an examination of Wisconsin v. Yoder, supra. There the
state’s interest was a very substantial one—the proper
education of voung children, a process which is so im-
portant the state makes such education compulsory. Not-
withstanding that vital state interest, the Supreme Court
did not permit it to interfere with the religious practices
of the Old Country Amish.
In the present case, the interest of New Jersey in
the integrity of the traditional college degree is far less
substantial than the interest of Wisconsin in the quality
of education of secondary school students.
Illustrative of the lesser significance of this interest
is the fact that New Jersey does not require that all
colleges be licensed by the State Board before they are
allowed to confer degrees. As noted in the State’s own
regulations:
The current status of New Jersey independent
institutions of higher education with respect to de-
gree approval varies widely. At one extreme are
the so-called pre-1S87 institutions which are not re-
quired to secure the approval of the Board of High-
er Education at all. At one extreme are the so-
called pre-1887 institutions which are not required
to secure the approval of the Board of Higher
Education at all. At the other are some of the
more recently founded institutions which have
been granted approvals under conditions far more
A-65
detailed than would be required by the policy set
forth in this Subchapter. In between these extremes
are other institutions—Upsala and the College of
Saint Elizabeth are examples—which were granted
broad powers by the State Board of Educé ‘ion
following passage of the Acts of 1912 and 1916.
N.J.A.C. 9:1-2.15 (footnote omitted).
The institutions which are not required to secure State
Board approval are Drew University, Seton Hall Uni-
versity, St. Peter’s College, St. Michael’s Monastery,
Stevens Institute of Technology, Princeton University and
Centenary College for Women. Theoretically, any one
of those colleges could adopt Shelton’s educational pro-
gram or any other program and their degree-awarding
powers would be unaffected by the State Board’s licens-
ing regulations.
Further, Shelton has not been charged with frand of
misleading conduct. There has been no showing that any
prospective students or parents of such students were
or would be misled if Shelton were to award degrees
for completion of its courses of study. Shelton’s inform-
ational material is in the record and it clearly describes
the kind of college Shelton is, the subject matter taught,
and the all-pervasive religious perspective of the Col-
lege.
Nor has it been shown that prospective employers of
Shelton graduates or graduate schools to which Shelton
students may apply will be misled by the award of Shel-
ton degrees. It is common knowledge that all manner
of institutions give all manner of degrees, having vary-
ing prestige and significance. In evaluating the signific-
ance of those degrees employers and graduate schools
A-66
look to the institutions which awarded the degrees, and
they look to the public and private agencies which ac-
credited such institutions. When appropriate, graduation
from an accredited college or university is made the
basis for qualification. see, for example, N.J. Court Rule
1:24-2(b) for the requirement for admission to the New
Jersey bar examination of receipt of a degree from a
law school approved by the American Bar Association.
Cases in this Court seeking the protection of the re-
ligious rights of state prisoners have disclosed the exist-
ence of small institutions of learning organized by the
Black Muslim sect whici award doctorate or other de-
grees. In at least one of these cases the Attorney Gen-
eral of New Jersey represented the State. These de-
grees are awarded without the imprimatur of the State
Board; the members of the sect thereby have available
to them a minister or imam or other officer who has
received a degree whereby his sect certifies that he has
successfully pursued a course cf study prescribed by that
sect; see, for example. Maiisk Abdul Alim v. Brendan
T. Byrne, Docket Nos. 76-0499, 76-1661 (Unpublished Opin-
ion filed July 8, 1980) (plaintiff's appeal pending).
Degrees have varying meanings and uses. <As evidenced
by N.J.wA.C, 9:1-2.15, New Jersey requires some tradi-
tional colleges and universities to obtain state licenses
before awarding a degree and it allows other traditional
colleges and universities to award degrees without any
state regulation whatsoever. It does not apnear that the
state makes any effort to regulate the granting of de-
grees by agencies of unconventional religious sects such as
the Black Muslims. In the light of these facts it cannot be
said that the state’s interest in the integrity of degrees
granted in New Jersey is so overwhelming that the reli-
A-67
gious rights of the Bible Presbyterians can be substantially
impaired. Nor is the state’s interest so overwhelming
that it may, through the licensing process. entangle itself
to a high degree in the religious activities of a wholly
religious college.
The injunction of the state court enforces the applica-
tion of the licensing statute and regulations against Shel-
ton College. Since I have concluded that the federal
plaintiffs are likely to prevail on the merits and that the
application of the licensing statute and regulations against
Shelton College is causing and will continue to cause them
irreparable injury, the defendants in this case will be
preliminarily enjoined from enforcing or implementing the
order of December 10, 1980 of the Chancery Division of
the New Jersey Supenor Court until such time as the
Supreme Court of New Jersey construes the New Jersey
statutes and regulations which are the subject of this
action.
Dated: May 18th, 1981.
Dickinson R. DeEBeEvoIse
United States District Judge
A-68
UNITED STATES DISTRICT COURT
District oF New JERSEY
(D.C. Civil No. 79-3341)
tin
—
NEW JERSEY-PHILADELPHIA PRESBYTERY OF
THE BIBLE PRESBYERTIAN CHURCH; SHELTON
COLLEGE, A Ministry of Bible Presbyterian Church;
BIBLE PRESBYTERIAN CHURCH OF COLLINGS-
WOOD, NEW JERSEY; KEVIN WILSON, BRAD
GSEL, KEVIN CLAIR MICHAEL, CURTIS JORDAN
BASHAW, LOUISE OLSON and EVERETTE CHAR-
LES OLSON,
Plaintiffs,
Vv.
NEW JERSEY STATE BOARD OF HIGHER EDUCA-
TION; T. EDWARD HOLLANDER, Chancellor of New
Jersey Department of Higher Education; RICHARD D.
BRESLIN, Assistant Chancellor for Academic Affairs
of the New Jersey Department of Higher Education;
and AMORITA SUAREZ, Director of the Office for
Independent Colleges and Universities of the New Jersey
Department of Higher Education,
Defendants.
¢
ORDER
Anp Now, this 18th day of May, 1°S1, upon considera-
tion of Plaintiffs’ Motion for Preliminary Injunction and
A-69
Memorandum in Support thereof, and after hearing, and
it further appearing to the Court that unless a pre-
liminary injunction is entered, Plaintiffs will suffer im-
mediate and irreparable injury resulting from enforce-
ment of the Orders of the Superior Court of New Jer-
sey, Chancery Division, prohibiting Shelton College from
issuing baccalaureate or collegiate degrees and inhibit-
ing the right of Shelton College to advertise within the
College’s own catalogue, and it further appearing to the
Court that Defendants will not be harmed br the entrv
of such preliminary injunction, and the Court having
filed an opinion setting forth its nndings of fact and con-
clusions of law, it is hereby OrprerRep, ADJUDGED anp DeE-
crEED THat: Defendants and all other persons acting in
their behalf are hereby restrained from enforcing or im-
plementing the Order of December 10, 1980. in the case
known and styled as The New Jersey State Board of
Higher Education, et al. v. The Board of Directors of
Shelton College, et al. (Superior Court of New Jersey.
Chancery Division, Cape May County, Docket No. C-1088-
79E), until such time as the Supreme Court of New Jer-
sey definitively construes the New Jersey statute here
complained of in light of Plaintiffs constitutional claims.
Dickinsox R. DEBEVOISE
United States District Judge
A-70 |
APPENDIX E
Opinion and Amendments of the United States Court of
Appeals for the Third Circuit
Nos. 80-1253, 80-1254 and 80-2703
NEW JERSEY-PHILADELPHIA PRESBYTERY OF
THE BIBLE PRESBYTERIAN CHURCH; SHEL-
TON COLLEGE, A Ministry of Bible Presbyterian
Church; BIBLE PRESBYTERIAN CHURCH OF
COLLINGSWOOD, NEW JERSEY: KEVIN WIL-
SON, BRAD GSEL, KEVIN CLAIR MICHAEL,
CURTIS JORDAN BASHAW, LOUISE OLSON
AND EVERETTE CHARLES OLSON, . i
Appellants in Nos. 80-1253 and 80-2703
v.
NEW JERSEY STATE BOARD OF HIGHER EDUCA-
TION; T. EDWARD HOLLANDER, Chancellor of
New Jersey Department of Higher Education;
RICHARD D. BRESLIN, .Assistant Chancellor for
Academic Affairs of the New Jersey Department of
Higher Education; and AMORITA SUAREZ, Direc-
tor of the Office for Independent Colleges and Uni-
versities of the New Jersey Department of Higher
Education,
Appellants in No. 80-1254
(D. C. Civil No. 79-3341)
ON APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY
Argued October 16, 1980
Before GIBBONS and ROSENN, Circuit Judges, i
and WEBER,” District Judge
(Opinion Filed April 14, 1981)
* Hon. Gerald J. Weber, United States District Judge for the West-
ern District of Pennsylvania, sitting by designation.
A-71
JOHN J. DEGNAN
Attorney General ot New Jersev
STEPHEN SKILLMAN
Assistant Attorney General
ROBERT A. FAGELLA ( Argued}
Deputy Attorney General
State House Annex
Trenton, New Jersev 08625
Attorneys for New Jersey State
Board of Higher Education, et al.
WILLIAM BENTLEY BALL. ESQ..
(Argued )
PHILIP J. MURREN. ESQ.
KATHLEEN A. O'MALLEY. ESQ.
BALL and SKELLY
511 N. Second Street
Harrisburg, Pennsvivania 17108
C. CLARK HODGSON, JR., ESQ.
GEORGANNE DAHER TERRILL. ESQ
SILVANA MOSCATO BRIGHTBILL. ESQ.
STRADLEY RONON STEVENS &
YOUNG
1100 One Franklin Plaza
Philadelphia, Pennsylvania 19102
Attorneys for New Jersey-
Philadelphia Presbytery of the Bible
Presbyterian Church, et al
Of Counsel:
Keith J. Bashaw, Esquire
Keith J. Bashaw, P.A.
30 Haddon Avenue
Haddonfield, New Jersey 08033
A-72
OPINION OF THE COURT
GIBBONS, Circuit Judge.
We here consider cross appeals from an order of the
district court granting in part and denying in part an ap-
plication for preliminarv injunctive relief against the en-
forcement of certain statutes and regulations of the State
of New Jersey dealing with the licensing of private insti-
tutions of higher education.' The plaintiffs are Shelton
College, a New Jersev corporation (Shelton), New
Jersev-Philadelphia Presbvterv of the Bible Presbyterian
Church, the regional ruling body of Bible Presbyterian
Church, and Bible Presbyterian Church of Collings-
wood, New Jersey, a member of the Bible Presbyterian
Church (the Churches); four full-time students at
Shelton (the students); two parents of students (the par-
ents); and Everette Charles Olson, professor of math-
ematics and chemistrv at Shelton (the faculty member).
The defendants are the New Jersey State Board of High-
er Education and several individual state officials
charged with the enforcement of the challenged regula-
tions (the Board). We affirm.
I.
Facts and Proceedings in the District Court
As an essential part of their religious mission, the
Churches, which are part of a nationwide fundamenial-
ist Christian sect, sponsor Shelton, a small denomina-
tional institution which for several decades has been the
principal source of the denomination’s seminarians.
Shelton owns a carnpus in Cape May, New Jersey. Since |
1. The opinion of the district court is reported. N.J.-Phila. Pres-
bytery v. N.J. State Bd. of Ed., 482 F.Supp. 968 (D.N.J. 1980). The
order appealed from both granted and denied a preliminary injunc-
tion. Thus we have appellate jurisdiction over both aspects of the
challenged order. 28 U.S.C. §1292(a)(1).
A-73
1971 it also has had facilities in Cape Canaveral. Florida.
and it is licensed by that state as an educational institu-
tion authorized to grant degrees. Shelton offers courses
for which it charges tuition, and purports to award Bach-
elor degrees in the Arts. Sacred Theology, Christian
Education, and Music. It accepts no local, state or teder-
al funds because of the Churches’ beliefs respecting the
separation of church and state. Shelton has been a party
to prior litigation with the Board.*
In the summer of 1979 a representative of the Board
learned that Shelton intended to offer courses of instruc-
tion at Cape May, and to grant degrees through its Flor-
ida affiliate. An on-site investigation at Cape Mav dis-
closed the presence of students. Since Shelton did not
then hold a license from the Board, its representative in-
formed the College's president that it was operating in
violation of New Jersey law.
On November 15, 1979 the Board filed in the Supe-
rior Court of New Jersev, Chancery Division. a com-
plaint for declaratory and injunctive relief, alleging that
Shelton is offering courses of instruction for credit with-
out the requisite license, and seeking a judgment
1. enjoining and restraining the College and its em-
ployees, servants and agents from engaging in,
assisting in or causing the offering of any
courses or classes of instruction, or engaging in
any form of educational instruction or offering or
providing any credits, awards, certificates or de-
grees for any such instruction or educational ex-
perience which has been given to any enrolled
student or other individual in or about Cape Mav
since September 1, 1979, until a license is
issued.
2. See Shelton College v. State Bd. of Ed. 48 N.Jj. 501. 226 A.2d
612 (1967); In re Shelton College, 109 N.J. Super. 488. 263 A.2d
810 (App. Div. 1970). See Section III. infra.
A-74
2. Declaring that any operation of Shelton in New
Jersey which has heretofore taken place without
a license is unauthorized and contrary to law.
See Verified Complaint for deciaratorv and injunctive re-
lief of New Jersev State Board of Higher Education, p. 4
(filed in the Superior Court of New Jersey, Chancery Di-
vision, Nov. 15, 1979). On the date the complaint was
filed. the Superior Court issued a temporary restraining
order enjoining all Shelton’s educational or instructional
activities.* The defendants in the Superior Court suit are
Shelton’'s directors, and two of its officers. Neither the
Churches, the students, the parents nor anv faculty
member are parties to that suit.
On November 19, 1979 the plaintiffs filed in the dis-
trict court an action under 42 U.S.C. §1983, alleging
that the efforts of the Board to prevent Shelton’s educa-
uonal and instrucuonal acuvities unless it complied with
New Jersey's licensing scheme violated their nghts to
the tree exercise of religion, unduly entangled the State
in the affairs of a religious institution, denied their nghts
in education to express, transmit and receive ideas, de-
nied their property nghts and denied them equ... protec-
tion of the law. They contended, moreover, that the stat-
ute and regulations the Board sought to enforce were
unconstitutionally vague. The district court held an
evidentiarv hearing on piaintiffs’ motion for a prelimi-
narv injunction, and made findings of fact. Neither side
challenges these fact findings on appeal.* On the basis
of these findings the district court concluded:
ee .
3. A limited exception was provided in the temporary restrain-
ing order for students then enrolled, permitting them to attend unul
the end of the academic semester on December 22. 1979.
4. The distnet court found, with respect to the parents, the stu-
dents, and the tacultv members at Shelton. that thev all shared the
same theological belieis and codes of personal conduct.
Central to their behets ts their conviction that the Bible is
infallible. inerrant Word of God which provides guidance tor ev-
A-75
1. that the instant suit was not barred bv res
judicata:
2. that the pendency of the Superior Court action
for injunctive relief against Shelton’s directors
NOTE 4 — ‘Continued
erv phase of life. Thev believe in the fallen nature of man. that
bv reason of his sinful nature man cannot (as the “humanist”
would contend) achieve his own Utopia or salvation. that man
can be saved only by the subsutuuonarv sacrifice of Jesus and
the acceptance of that sacnfice bv the believer
For these persons there are no areas of life which are not
governed bv their Biblical faith. whether it be their persona!
conduct, their vocations or the subjects thev teach. Both the
students and the teachers who tesuhed believe that their pres-
ence at Shelton College is tor the purpose of preparing them-
selves or others to pertorm the missions their Lord culls upon
them to pertorm
Several of these students could have attended recognized
secular colleges and universiues had they chosen to do su. The
teachers work at Shelton College at considerable financial sac-
nfice to themselves
When students attend Shelton College. they accept a stnct
code of conduct embodied in their Student Handbook ( Exhibit
P-1). This includes dress codes. compulsory ~hapei four davs a
week, reframing trom studving. swimming, sun bathing and
athleucs on Sundavs. retraining from the possession or use of
alcoholic beverages. tobacco. non-medicinal narcoucs or hallu-
cinogenic drugs and manmyuana, and avoiding moder dance.
commercial movies and rock and roll music. There ts stnct reg-
ulauon of daung. engagements and marmage
Every academic subject is taught from a perspecuve of the
religious point of view of the fundamentalist denominauons.
whether it be history. art. economics. chemistry or English lit-
erature. The conduct and beliets of the Shelton student and the
theological doctrines which form the content of the academic
program are at total vanmance trom secular and must
church-sponsored colleges and universiues. This ts the reason
why the students have selected Shelton College. why the par-
ents wish their students to attend. and whv the tacultvy mem-
bers teach there. Thev seek the nurture and fellowship o! a
community of the fathtul, where thev can develop their under
standing and knowledge of their own fwth, and where they can
prepare to propagate it in the world at large
A-76
and two of its officers did not require dismissal of
the tederal complaint;
3. that a stav of the federal complaint pending re-
sort to the state court for an interpretation of the
challenged statute and _ regulations was
inappropniate;
4. that a preliminary injunction should issue, en-
joining the Board from taking any action having
the effect of preventing Shelton, its employees,
servants or agents from engaging in any reli-
gious, teaching, or educational activities or from
publicizing or advertising such activities, and
that the outstanding Supenor Court injunction
should be modified to permit such activities; and
that anv further preliminary relief with respect to
the Superior Court action should be denied.*®
ur
An order reflecting these conclusions was entered, and
these appeals followed. The Board contends that no pre-
liminary relief should have been granted; indeed that
the complaint should have been dismissed. The plain-
tiffs contend that the relief which was granted inad-
equately protects their first amendment nghts from
harm pendente lite, and that the Superior Court pro-
ceedings should have been enjoined while the federal
court disposed of the entire case.
The order secured by the State Board of Higher Education
requires that on December 22. 1979. Shelton College. the core
vf this community of believers. must cease teaching. By state
fiat a relagious Community will be destroved.
482 F Supp. at 974
5 Specifically. the distnct court enjoined the Board from en-
forcing the state court order forbidding teaching and advertising,
and prohibiung award of credits toward u Florida degree, but de-
clined to enjoin the Board trom entorcing the order pronibiting the
“urant of New Jersey degrees. Contrary to the sugyesuon in the con-
curmng opimon, page 4, that the distnect court enjoined enforce-
ment ol the licensing scheme in other respects. in fact no more was
enjoined than enlorcement of un overbroad temporary injunction.
BEST AVAILABLE COPY
A-77
II.
The New Jersey Regulatory Scheme
Prior to 1899 the State of New Jersev made no effort
to regulate private higher education. In specific in-
stances by special acts of the legislature. however. some
institutions were granted charters authorizing the con-
ferring of degrees.” An amendment to the New Jersey
Constitution in 1875 prohibited the legislature trom
granting a corporate charter other than by a general law.
See N. J. Const. Art. IV §7 “9. Thereafter educational in-
stitutions could only be chartered under genera! laws
such as those dealing with not for profit corporations.
and religicus societies. See N.J.S.A. 15: §1 et seq.; 16: §1
et seq. Since it was no longer lawful to confer degree
granting authority by special charter. in 1897 a statute
was passed authorizing anv seminary or school of theol-
ogy, whether founded under a general act of the legisla-
ture or by an old special charter, to conter designated de-
grees. P.L. 1897, C. 27, §1, p. 42; N.J.S.A. 18A:68-2.
Two years later a statute authorized any college founded
under any genera! act of the legislature to “give diplomas
and confer degrees upon those who shall successfully
complete prescribed courses of study, and confer honor-
ary degrees upon such others as shall be recommended
thereafter by its board of trustees." P.L. 1899. C. 116. §1,
p. 168; NJ-S.A. 18A:68-1.° No license requirement or
6. Centenary College for Women, L. 1867. C. 103, p. 172:
Seton Hal] University, L. 1861, C. 86, p. 198; St. Michael's Monas-
tery, L. 1866, C. 319, p. 753; Drew University. L. 1868. C. 2. p. 4:
Stevens Insutute of Technology, L. 1870. C. 52. p. 166: St. Peter's
College, L. 1872. C. 487. p. 1117. These six chartered
degree-granting instituuons, of which five were religiously affili-
ated, joined Rutgers, the State University (formerly Queen's Col-
lege) and Princeton University, (formerly the College of New Jer-
sey) both of which, also onginally religiously affiliated. held Roval
charters authorizing the granung of degrees.
7. The 1899 statute expressly negated authonty for a college to
confer degrees or diplomas authonzing the practice of medicine.
denustry, or law.
A-78
other form of state regulation accompanied these gener-
al authorizations.
In 1912, in the gubernatorial administration of
Woodrow Wilson, a former president of Princeton Uni-
versity. New Jersey for the first time adopted legislation
prescribing the terms and conditions uncer which de-
grees could be conferred. and prohibiting the conferring
of a degree “until the terms and conditions of such de-
gree. . . shall first be submitted to and approved by the
State Board of Education.” P.L. 1912, C. 315. This legis-
lation exempted from the license and course approval re-
quirements the specially chartered institutions listed in
footnote 5, both religiously affiliated and secular, and
New Jersey still considers them exempt. N.J.S.A.
18A:68-6; N.J.A.C. 9:1-2.15. Institutions founded under
anv general act, including religiously affiliated institu-
tions such as Shelton, were covered by the 1912 law,
and by a 1916 statute, P.L. C. 152, §1, p. 308, which su-
perseded it. Section 1 of the 1916 law, found now at
N.J.S.A. 18A:68-3, provides:
No corporation shall furnish instruction or learning
in the arts, sciences, or professions for the purpose
of admitting any person to the grade of a degree, or
shall confer or participate in conferring a degree,
giving to any person a diploma of graduation or of
proficiency in a course of study, in learning, or in
scientific arts or methods, within this state, until it
shall have filed a certified copy of its certificate of
incorporation with the board of higher education
and obtained for such board a license to carry on the
business under such rules as the board of higher
education may prescribe.
Section 2 of the same law prohibits the corporation and
any of its members or officers from admitting any person
to the grade of a degree “without first submitting the ba-
sis or conditions thereof to the board of higher educa-
tion, and obtaining its approval thereof, and of the prac-
A-79
tice of conferring and bestowing such degrees.” N.J.S.A.
18A:68-6. The 1916 law authorizes the Attorney General
of New Jersey to seek from the Superior Court an order
restraining any corporation from “carrving on the busi-
ness of such instruction or teaching, or conferring any
such degree, or giving any such diploma without such
license.” N.J.S.A. 68-5. The same section permits the
Superior court to proceed “in a summary manner or oth-
erwise.”’ Monetary penalties, assessable against the cor-
poration, its members or officials in a summary proceed-
ing, and the nonpayment of which results in a 90 day
civil commitment to a county jail, sanction the license
and approval requirements. P.L. 1916, C. 152. §4 p. 310;
N.J.S.A. 18A:68-9, 10.
The 1916 law contains no exemption for Board ap-
proval of courses whose content is religious, or for diplo-
mas or degrees in theological subjects. Nor does it con-
tain any standards to guide the Board in approving “the
basis or conditions” of a degree “in recognition of the at-
tainment or (sic) proficiency of any person in pursuing
or graduating from any course or courses of study, arts.
or learning.” N.J.S.A. 18A:68-6. The Board has, howev-
er, adopted extensive regulations for those New Jersey
institutions subject to its “censure and approval juris-
diction. N.J.A.C. 9:1-1.1 - 9:1-6.4. Application for a li-
cense requires submission of a detailed questionnaire
and supporting documents. The prescribed form of
questionnaire, found in Appendix C to title 9 of the New
Jersey Administrative Code, p. 36.4 et seq., is attached to
this opinion as Appendix 1.
For institutions accredited by the Middle States As-
sociation, a private accrediting organization, the Board
ordinarily accepts such accreditation as sufficient for li-
censure and approval. N.J.A.C. 9:1-2.1. For institutions
not approved by the Middle States Association, the Board
has established a Licensing Approval Advisory Board.
N.J.A.C. 9:1-2.3-8. The Licensing Approval Advisory
A-80
Board recommends policies for licensure and degree ap-
proval for institutions not regionally accredited, recom-
mends approval or disapproval of petitions for licensure,
and reviews proposed license revocations. N.J.A.C.
9:1-2.7. Presumably the Advisory board’s recommenda-
tions are made consistent with the Board’s regulations.
These govern an institution’s statement of purpose,
N.J.A.C. 9:1-1.2; organization and administration,
N.J.A.C. 9:1-1.3; finances, N.J.A.C. 9:1-1.4; educational
programs, N.J.A.C. 9:1-1.5; faculty, N.J.A.C 9:1-1.7; li-
brary, N.J.A.C. 9:1-1.8; students and student services,
N.J.A.C. 9:1-1.9, physical facilities, N.J.A.C. 9:1-1.10;
and official publications, N.J.A.C. 9:1.1.11. The regula-
tions are, in a word, pervasive. Of particular relevance to
religiously affiliated institutions is the regulation dealing
with statement of purpose:
(a) Regulations concerning statement of pur-
pose are:
1. Each institution shall maintain appro-
priate and operationally effective statements of
purpose (such as those found in the college
catalog and other official documents) and shall
review these statements for possible revision
and improvement at periodic intervals not to
exceed five years;
2. Copies of statements of purpose shall be
promptly filed with the chancellor and, when
required by the Department of Higher Educa-
tion, implementation schedules shall be
similarly filed.
(b) Standards concerning statement of pur-
poses are:
1. Statements of institutional purpose
should define the educational climate to be es-
tablished, the nature of the education students
are expected to have upon graduation, the oc-
cupational and other outcome expected from
A-81
the programs, and the aspects of individual
growth to be enriched or developed:
2. Each institution should be prepared to
present evidence that the various elements of
institutional life (faculty work. educational pro-
gram, student life. finances. physical plant, or-
ganization and administration) are structured
to support the purposes stated:
3. Each institution should develop a
long-range plan to implement its goals, includ-
ing a written schedule of priorities, resource al-
locations and responsibility assignments, with
target dates for the realization of specific
objectives;
4. Purposes and plans should be devel-
oped and periodically reviewed by a committee
drawn from appropriately concerned institu-
tional constituencies, and should be available
for distribution to all constituent groups.
N.j.A.C. 9:1-1.2.
The requirement of a statement of purpose is not
merely informational, for the regulation dealing with
educational programs provides that “[t]he educational
program shall refiect and support the purposes of the in-
stitution” and “shall include course work and other ac-
tivities extending over a sufficient period of time and in
sufficient intensity to fulfill the purposes of the institu-
tion.” N.J.A.C 9:1-1.5(a)1, 2. Thus on the face of the
regulations it would appear that in order to obtain a li-
cense, an ins*’iiution with a religious commitment such
as Shelton’s must submit to the Board a statement of its
religious purpose, as well as evidence that the various
elements of its institutional life are structured to support
that purpose. and must submit to the Board's judgment
| the question whether its educational program reflects
} and supports that purpose. Facially, therefore. the
A-82
Board's licensing regulations suggest a very high degree
of state entanglement in Shelton’s religious affairs. And
the 1916 law unambiguously prohibits instruction lead-
ing to a diploma or degree. even in theology, absent a
license.®
ITT.
Prior Litigation
At one time Shelton had a New Jersey license. Un-
der the 1916 Act the Board mavy ievoke a license,
N.J.S.A. 18A:68-4, and in 1966 it instttuted a revocation
proceeding.” When the Board entered an order limiting
Shelton’s authority to grant a bachelor of arts degree to
June 30. 1967, the college sought review of the agency's
decision in the Superior Court, Appellate Division. See
N.J.R. 2:2-3(a)(2). The Supreme Court of New Jersey
certified the case before argument in the Appellate Divi-
sion, reviewed the abbreviated record made before the
agency,'° and considered Shelton’s legal challenges to
8 Cf. NLRB v Catholic Bishop ot Chicago. 440 U.S. 490,
502-03 (1979) (NLRB junsdicuon over alleged unfair labor prac-
uces in Catholic religious schools would result in impermissible en-
tanglement. for the Board's resoluuon of unfair labor practices
charges “will necessarily involve inquiry into the good faith of the
posiuon asserted by the clergy-administrators and its relationship to
the school's religious mission.’ Moreover. NLRB determination of
the “terms and condiuons of employment” would enmesh the Board
in “nearly everything that goes on in the schools.”).
9. The reasons tor the proposed revocauon do not appear in
this record or in any reported New Jersey opinion.
10. Chief Justice Weintraub described that record as follows:
The record consists onlv of the notice of appeal and the res-
vluuons already menuoned. The first resolution. dated
December 13. 1965. recites the following: that on June 2. 1965
the State Board of Educauon resolved not to grant approval to
Shelton of its practuce of coniermny degrees; that a hearing be-
gun on July 2]. 1965 was interrupted bv legal action initiated
by Shelton with the result that the school vear 1965-66 got un-
der way: that upon request Shelton submitted a statement of its
A-83
the 1916 law. In this agencv review proceeding Shelton
adduced no proof. but contended that the 1916 law was
unconstitutional:
1. because anv effort by the state to regulate in anv
way the award of a bachelor’s degree violated the
free speech guaranty of the first amendment:
2. because the statute sets forth no standard for the
exercise of delegated legislative power. and thus
violates Art. IV §1 1 of the New Jersey
Constitution; es
3. because the grandfather clause exempting the
chartered institutions listed in footnote 5 creates
an unconstitutional classification; and
4. because the Board lacked statutory power to
grant conditional approvals. |
No free exercise clause or entanglement claims were
made or considered. The Supreme Court rejected the
four clairms Shelton did present. Following that court's
decision, further revocation proceedings took place be-
NOTE 10 — (Continued)
current condition; that a further investigation revcaled compli-
ance with some cf the standards which theretofore had not
been met; that a question continues as to compliance with oth-
er standards described in the resolution; but nonetheless in the
interest of the students then enrolled and in the light of the
problems attendant upon a disruption of the college in midyear.
approval was given of the practice of conferring the degree of
bachelor of arts, such approval to conunue to September 15.
1966. As we have already noted. the State Board of Education
adopted a further resolution (dated June 27, 1966) which, after
reciting a later annual evaluaticn of the college and the Board's
finding that certain specified standards had not vet been met.
nonetheless concludes the authority to bestow the degree of
bachelor of arts should be extended until June 30, 1967 upon,
however, 12 stated conditions to be met by Shelton not later
than May 1, 1967.
48 N.J. at 505-06; 226 A.2d at 614-15. The record in this case does
not disclose what were the 12 stated conditions for licensure.
A-84
fore the Board, and ultimately Shelton lost its license. !!
So far as this record discloses, no free exercise clause or
entanglement claims were made or considered at any
time in the Board’s revocation proceedings. Nor is there
any indication that any of the previous New Jersey agen-
cy or court litigation dealt with teaching rather than de-
gree granting.
The Board contends that the doctrines of res
judicata or collateral estoppel preclude preliminary in-
junctive relief, and require dismissal of the complaint.
The district court rejected this contention. 482 F.Supp.
at 975-76. We agree. The federal courts are referred, for
the claim and issue preclusion effect of a state court
judgment, at least initially, to the law of the rendering
state. 28 U.S.C. §1738. New Jersey requires, for the ap-
plication of res judicata, identity of causes of action, of
parties or their privies, and of issues. E.g., Brick Tp.
Ocean County v. Vannell, 55 N.J. Super. 583, 590, 151
A.2d 404, 408 (App. Div. 1959) (Haneman, J.). In the li-
cense revocation proceedings only Shelton was a party.
There has been no showing that for purposes of the free
exercise and establishment claims Shelton was a privy
for the Churches, parents, students,.and faculty mem-
ber presently before us. Moreover, even as to Shelton
there has been no showing that the license revocation
proceeding involved in any way the religion clause is-
sues urged in this Section 1983 action. Clearly a New
Jersey court would not hold that the complaint before us
is barred by res judicata. Indeed if it were to do so with
respect to the claims of the Churches, parents, students
and faculty member, such a holding would violate the
due process clause of the fourteenth amendment.
Parklane Hoisery Co. v. Shore, 439 U.S. 322, 327 n.7
11. Only a procedural aspect of the revocation proceedings was
reviewed by the New Jersey Courts. In re Shelton College. 109 N.J.
Super. 488. 263 A.2d 810 (App. Div. 1970).
A-85
(1979) (“It is a violation of due process for a judgment to
be binding on a litigant who was not a party or a pnvv
and therefore has never had an opportunity to be
heard”); Blonder-Tongue v. University Foundation. 402
U.S. 313, 329 (1971); Hansberry vz. Lee. 311 U.S. 32. 40
(1940).
As to collateral estoppel. that doctrine in New Jersev
precludes relitigation onlv of questions “distinctly put in
issue” and “directly determined” adversely to the party
against which the estoppel is asserted. City of Plainfield
v. Public Service Gas and Electric, 82 N.J. 245, 257-58.
412 A.2d 759, 765-66 (1980). Moreover, under the New
Jersey rule, if the judgment is based on one or more of
several grounds, but does not expressly rely on anv of
them, none is conclusively established, since a subse-
quent court cannot tell what issue or issues were in fact
fully adjudicated. Ettin v. Ava Truck Leasing, Inc., 53
N.J. 463, 480-81, 251 A.2d 278. 287 ( 1969) (Jacobs, J.),
overruling Kelley v. Curtiss, 16 N.J. 265, 108 A.2d 431
(1954) (Brennan, J.). Cf. Boykins v. Ambridge Area
School Dist., 621 F.2d 75 (3d Cir. 1980) (no preclusive
effect accorded decision of state agency when impossi-
ble to tell what it decided). Here it is clear from the two
judicial opinions in Shelton’s prior litigation with the
Board that no religion clause claims were considered or
determined.
The Board has not made any showing as to what, fi-
nally, was litigated at the agency revocation proceedings
which were not judicially reviewed. Whether New Jer-
sey would apply principles of judgment preclusion — ei-
ther res judicata or collateral estoppel — to those pro-
ceedings is a decidedly open question, depending on an
analysis of the Board’s statutory authority to perform an
adjudicative as distinguished from a policy making func-
tion. See Lubliner v. Bd. of Alcoholic Bev. Co., Paterson,
A-86
33 N.J. 428, 165 A.2d 163 (1960).'* For two reasons,
however, we need not speculate whether New Jersey
would treat the Board's license revocation proceeding as
adjudicative or policy making. First, “[rjes judicata and
collateral estoppel are affirmative defenses that must be
pleaded.” Blonder-Tongue v. University Foundation,
402 U.S. 313, 350 (1971); Fed. R. Civ. F. 8(c). The
Board did not, in opposing the grant of a preliminary in-
junction, establish that it adjudicated the religion clause
claims presented in this case, or even that it had statu-
tory jurisdiction to consider them. It simply failed to
meet the burden Rule 8(c) imposes.'* Second, the Su-
preme Court has held that neither 28 U.S.C. §1738 nor
federal common law principles of res judicata require
deference to administrative as distinct from judicial pro-
ceedings, Prentis v. Atlantic Coal Line Co., 211 U.S.
210, 226-28 (1908); FTC v. Texaco, Inc., 555 F.2d 862,
894 (D.C. Cir.) (en banc), cert. denied 431 U.S. 974
(1977). '4
We conclude, therefore, that the district court did
not err in rejecting the Board’s contention that the prior
litigation referred to precluded the grant of a preliminary
injunction protecting the plaintiffs from violations of the
religion clauses of the first amendment. See New Jersey
Education Ass’n v. Burke, 579 F.2d 764 (3d Cir. 1978);
cf. Wooley v. Maynard, 430 U.S. 705 (1977).'®
12. New Jersey does accord res judicata and collateral estoppel
effect to decisions of administrative tribunals, City of Hackensack
v. Winner, 82 N.J. 1, 410 A.2d 1146 (1980).
13. See New Jersey Education Ass'n v. Burke, 579 F.2d 764,
775-76 (3d Cir. 1978), “res judicata is an affirmative defense, de-
pendent on the factual issue of what submissions were actually
made to the state court.”
14. Moreover, litigants need not exhaust those remedies before
seeking relief under Section 1983. Moore v. City of East Cleveland,
431 U.S. 494, 497 n.5 (1977); Ellis v. Dyson, 421 U.S. 426, 432
(1975); McNeese v. Board of Educ., 373 U.S. 668 (1963).
15. The Supreme Court’s recent decision in Allen v. McCurry,
49 U.S.L.W. 4015 (Dec. 9, 1980), does not warrant a different con-
ee ae ae Pe wae iP ee
A-87
IV.
Younger Dismissal
Although it has not abandoned its judgment
preclusion argument. the Board on appeal relies chiefiv
on the contention thai principles of equitv. comity and
federalism required that the federal court stay its hand
so that the religion clause contentions be litigated first in
the Superior Court of New Jersey. It relies on the spawn
of Younger v. Harris, 401 U.S. 37 (1971). to assert that
because the Board filed its Superior Court action against
Shelton's directors and two of its officers first, the federal
complaint of all the plaintiffs, whether or not they were
defendants in the state court action, must be dismissed.
The district court rejected that broad proposition; rightly
so, we hold.
We note at the outset that for the Churches, par-
ents, students and teacher, the governing precedents
are Steffel v. Thompson, 415 U.S. 452 (1974) (declara-
tory relief) and Doran v. Salem Inn, Inc., 422 U.S. 922
(1975) (preliminary injunctive relief). These plaintiffs
are not parties to any state court proceeding. Like the
plaintiff in Steffel, they were confronted, from the com-
mencement of the state’s lawsuit against someone else,
with a real threat of harm to them. Each of these plain-
tiffs has asserted individual first and fourteenth amend-
ment rights distinct from those Shelton, its directors and
its officers assert. See Verified Complaint. pp. 3-4; 7-9:
13-15. Specifically, the Churches maintain that the
NOTE 15 — (Continued)
clusion here. That decision affirmed the application of 28 U.S.C.
§ 1738 to litigation under 42 U.S.C. §1983. but also stressed that the
full faith and credit statute required that the federal plaintiff have
fully and fairly litigated the same issues in state court. Because the
prior New Jersey proceedings did not address Shelton's religion
clause contentions, neither §1738. nor the Supreme Court's
McCurry discussion would attribute preclusive effect to the earlier
New Jersey proceedings.
A-88
Board's enforcement of the regulations deprives them of
their first and fourteenth amendment nghts to minister
to voung adults through Shelton College; the students
argue that enforcement deprives them of their first and
fourteenth amendment rights to receive a christian edu-
cation; the parents assert enforcement deprives them of
their first and fourteenth amendment nights to guide
their children's choice of post-secondary education; the
teacher claims enforcement deprives him of his first and
fourteenth amendment rights to “pursue his religious
ministry and Christian apostolate.” These rights, with
the possible exception of the Churches’ rights (the
Churches characterize Shelton as an “agency” of the Bi-
ble Presbyterian Church), are all distinct from the col-
lege’s mght to exist as a_ religious-educational
institution. '®
The Supreme Court has held that the “opportunities
of pupils to acquire knowledge,” is a first amendment
right distinct from the right to impart knowledge. Meyer
v. Nebraska, 262 U.S. 390, 401 (1923). Moreover, the
Court has recently emphasized that the distinct “first
amendment right ‘to receive information and ideas’... .
is nowhere more vital than in our schools and universi-
ties.” Kleindienst v. Mandel, 408 U.S. 753, 762-63
(1972). Even if one concludes that the Churches, teach-
er, and parents have no independently assertable rights,
Supreme Court precedent clearly indicates that the stu-
dents have distinct rights which may be enforced in a
separate federal action.
An objection might be made that despite their asser-
tion of independent nights, all of these plaintiffs are too
interrelated with Shelton College to permit a separate
federal court action. The Supreme Court's articulation of
16. Hence, it is clear that the suggestion in the concurring
opinion that the nonparties are in effect suing only on behalf of
Shelton College, see concurring op. at 16 n.13, finds no foundation
in the record.
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the contours of derivative preclusion in Younger cases.
however, has been limited to preclusion of an empiover's
federal suit when its emplovees assert identical interests
in state court, Hicks v. Miranda, 422 U.S. 332, 348-49
(1975), and to preclusion of federal plaintiffs too inter-
twined with the state defendants “in terms of ownership.
control and management,” Doran v. Salem Inn, 422 U.S.
at 929. Clearly, a majority of the Court has formulated
derivative preclusion only in terms of an identity of eco-
nomic activities and interests. Certainly, the parents and
students in this action neither own, nor control, nor
manage Shelton College. Arguably, the teacher, as a
Shelton College employee, might be barred under Hicks.
The relevance of Hicks, however, is merely superficial.
The employer in Hicks was derivatively precluded be-
cause any claim his emplovees could make in state court
regarding their first amendment right to participate in
the screening of Deep Throat derived from their status
as agents asserting the employer's right to show the film.
Here, the teacher asserts an individual first amendment
right to teach a particular theology. That right is distinct
from Shelton’s right, as a school, to propagate its doc-
trine. Arguably, the Churches might be precluded under
an ownership, management and control theory. But
while Shelton College is the teaching arm of the Bible
Presbyterian Church, the Board has not shown to what
extent the two Churches in this suit in fact manage and
control the college, and the state court action is against
the separate directors and officers of the college. '’
17. Chief Justice Burger's concurrence in Allee v. Medrano.
416 U.S. 802, 830-31 (1974). would also extend the derivauve
preclusion principle to an organization seeking to assert in federal
court the interests of members prosecuted in state court. A majority
of the Court has yet to adopt an organizational preclusion theory
Even if that theory represents the direction toward which the Court
is inclined, it is of no relevance to the students. teacher. and parents
here, for the Chief Justice did not contend that individual members
of an organization could not assert their own interests in federal
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The concurrence purports to rely not on an
interrelationship analysis to preclude the nonparties ac-
tion, but on a theory that derivative preclusion is war-
ranted here because the nature of the relief the district
court awarded in this case differs markedlv from the re-
lief in Steffel and Doran. Although those cases arose out
of nearlv identical fact situations and presented identical
legal issues to the state and federal tribunals, the con-
currence notes that the federal courts were not asked to
interfere in the pending state proceedings. It urges that
in this case, however, the federal court is requested to
enjoin the enforcement of the state court's preliminary
injunction. Unlike Steffel and Doran, therefore, this
case involves direct federal interference in an ongoing
state enforcement proceeding. If the Younger doctrine
forbids anything, the concurrence contends, it prohibits
anv direct federal] court interference with anv state en-
forcement proceeding.'® This “direct interference” the-
court when the organization was the subject of a pending state en-
forcement proceeding. Such an assertion would in this case reduce
to an untenable proposition that if a church might assert its congre-
gation s interests in state court, no individual member of the flock
may be heard in federal court to press the tenets of his or her own
faith.
Nor does the Chief Jusuce’s concurrence stand for the proposi-
uon that an individual federal plainuff who is a member of an organ-
ization to which the individual state defendant also belongs may not
sue in federal court. In Ste
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