Amicus Curiae Brief — Rivkin v. Dover Township Rent Leveling Board

No. ad

In the

Supreme Court of the United States

October Term, 1995

—+

DAVID RIVKIN, EDWARD RIVKIN,

JUDITH RIVKIN, t/a GALAXY MANOR,

A New Jersey Partnership,

Petitioners,

Vv.

DOVER TOWNSHIP RENT LEVELING BOARD,

Respondent.

«

Petition for Writ of Certiorari

to the New Jersey Supreme Court

>

MOTION FOR LEAVE TO FILE BRIEF

AMICUS CURIAE AND BRIEF AMICUS CURIAE

OF PACIFIC LEGAL FOUNDATION IN SUPPORT

OF PETITION FOR WRIT OF CERTIORARI

—e—

JAMES S. BURLING

*VicToR J. WOLSKI

*Counsel of Record

Pacific Legal Foundation

2151 River Plaza Drive,

Suite 305

Sacramento, California 95833

Telephone: (916) 641-8888

Attorneys for Amicus Curiae

i

No. 95-1980

oiaieons

In the

Supreme Court of the United States

October Term, 1995

+

DAVID RIVKIN, EDWARD RIVKIN,

JUDITH RIVKIN, t/a GALAXY MANOR,

A New Jersey Partnership,

Petitioners,

Vv.

DOVER TOWNSHIP RENT LEVELING BOARD,

Respondent.

Petition for Writ of Certiorari

to the New Jersey Supreme Court

—+

MOTION FOR LEAVE TO FILE BRIEF

AMICUS CURIAE IN SUPPORT OF

PETITION FOR WRIT OF CERTIORARI

Pursuant to Supreme Court Rule 37.2(b), Pacific

Legal Foundation (PLF) respectfully moves this Court for

leave to file the attached amicus curiae brief in support of the

petition for writ of certiorari filed by David Rivkin, et al.

Consent to the filing of this brief has been granted by counsel

for petitioners and has been lodged with the Clerk of this

Court. Respondent, Dover Township Rent Leveling Board,

has withheld consent, necessitating the filing of this motion.

—— eT

ii

IDENTITY AND INTEREST OF AMICUS CURIAE

PLF is a nonprofit, tax-exempt corporation organized

under the laws of the State of California for the purpose of |

litigating in the public interest. PLF has over 20,000

contributors and supporters located throughout the Nation and

maintains its principal office in Sacramento, California.

Policy for PLF is set by a Board of Trustees composed of

concerned citizens, many of whom are attorneys. PLF’s

Board of Trustees evaluates the merits of any contemplated

legal action and authorizes such legal action only when the

Foundation’s position has broad support within the general

community. PLF’s Board of Trustees, through its legal

review committee, has authorized the filing of an amicus

curiae brief in this matter.

Attorneys for PLF have participated in numerous

cases concerning constitutional protections for property rights

before this Court and other courts representing both amicus

curiae and property owners. Many of these cases involved

the Due Process Clause, including Lockary v. Kayfetz, |

908 F.2d 543 (9th Cir. 1990), in which PLF attorneys were .

counsel of record, and Pennell v. City of San Jose, 485 U.S.

1 (1988), in which PLF participated as amicus curiae. PLF

also participated as amicus curiae before this Court in PFZ |

Properties, Inc. v. Rodriguez, 928 F.2d 28 (1st Cir.), cert.

granted, 502 U.S. 956 (1991), cert. dismissed, 503 U.S. 257

(1992).'

' PLF has also participated in virtually every major case before this

Court in the last two decades involving land use and the Takings Clause. |

For example, PLF attorneys represented the Nollans in Nollan v. |

California Coastal Commission, 483 U.S. 825 (1987), and PLF has |

participated as amicus curiae in cases from Agins v. City of Tiburon,

447 U.S. 255 (1980), to Dolan v. City of Tigard, 512 U.S. __, 129 L.

Ed. 2d 304 (1994).

iii

PLF also has a Rent Control Project which is actively

litigating procedural and substantive infirmities, of consti-

tutional dimensions, in the administration of local rent

control laws by four California cities. Attorneys in PLF’s

Rent Control Project are counsel of record in Santa Monica

Beach, Ltd. v. Superior Court, 42 Cal. App. 4th 1228

(1996), review granted by California Supreme Court. PLF

also participated as amicus curiae before this Court in Yee v.

City of Escondido, 503 U.S. 519 (1992).

Amicus seeks to augment the argument in the petition

for writ of certiorari. PLF believes that its public policy

perspective and litigation experience in support of property

rights will provide an additional viewpoint with respect to the

constitutional and legal issues presented. Specifically, PLF

will demonstrate that the court in this case departed from the

commonly accepted requirement, in conflict with a number

of federal appellate courts, that administrative adjudications

affecting private property rights be justified by an articulated

and legitimate rationale. PLF will also show that the court’s

holding is inconsistent with the precedents of this Court when

the New Jersey court ruled that postdeprivation remedies can

iV

insulate government agencies from constitutional liability for

a procedurally deficient hearing that deprived citizens of their

property rights.

DATED: July __, 1996.

Respectfully submitted,

JAMES S. BURLING

*VICTOR J. WOLSKI |

*Counsel of Record :

Pacific Legal Foundation

2151 River Plaza Drive,

Suite 305

Sacramento, California 95833

Telephone: (916) 641-8888

By

VICTOR J. WOLSKI

Attorneys for Amicus Curiae

Vv

TABLE OF CONTENTS

MOTION FOR LEAVE TO FILE

BRIEF AMICUS CURIAE IN

SUPPORT OF PETITION FOR

We ee ak 6 5 S88 06'S HR 8 HR EO i

IDENTITY AND INTEREST

er See MINE hoa he HK Nbc bese wR lee a ges ii

Sata Ge RAE. 8 4 Wied AS eee ORES © wil |

SURE AE GIEUETE Sac blles etch enees 6

po Aa re a eed pea eee eee ee ee 7

I. THIS COURT SHOULD RESOLVE

THE CONFLICTS OVER WHETHER

THE DUE PROCESS CLAUSE

PROTECTS PROPERTY OWNERS FROM

ARBITRARY AND CAPRICIOUS

GOVERNMENT RESTRICTIONS OF

pp GB a Os ee ee 7

A. The “Shocks the Conscience” Test for Due

Process Violations, Originating with the

Rochin Opinion, Was Designed for the

Context of Liberty Infringements in the

Course of Crime Detection and Punishment

and Is Inappropriate for Property

PT 0 os ce a 008 00 0 eo 0 0-0 8c 7

Il.

vi

B. Government Decisions That Restrict

Property Rights Should be Scrutinized

to Determine if the Actions Are

Arbitrary, Capricious, or Irrational ........... 9

THIS COURT SHOULD CLARIFY

WHETHER DUE PROCESS REQUIRES

ADMINISTRATIVE DETERMINATIONS

THAT RESTRICT PROPERTY RIGHTS

TO BE BASED ON LEGITIMATE,

ARTICULATED JUSTIFICATIONS ........... 12

THIS COURT SHOULD DETERMINE

WHETHER A PROCEDURALLY

INADEQUATE HEARING IN WHICH

A BIASED MEMBER PARTICIPATES

VIOLATES DUE PROCESS OR IS INSTEAD

SUBJECT TO THE PARRATT DOCTRINE ...... 16

A. Deliberate Decisions by a Government

Body in the Course of a Public Hearing

Are Not Random, Unauthorized Acts ......... 16

B. Failure to Disqualify a Biased Member

from an Administrative Decision Taints

the Proceedings and Deprives Applicants

of Their Right to Due Process ..........+.. 18

CONCIAIGION . cece rccevtvcetcvvetectooees 19

Vii

TABLE OF AUTHORITIES CITED

Page

Cases

Agins v. City of Tiburon, 447 U.S. 255 (1980) ....... ii,14

Amsden v. Moran, 904 F.2d 748 (Ist Cir. 1990) ....... 11

Brady v. Town of Colchester,

te oe A a Dyn 0's bo ope 0'0 6.0 0.08 ¥ 10,12

Bello v. Walker, 840 F.2d 1124 (3d Cir. 1988) ........ 12

Chesterfield Development Corporation v. City

of Chesterfield, 963 F.2d 1102 (8th Cir. 1992) ........ 11

Chicago, Burlington & Quincy Railroad Co. v.

City of Chicago, 166 U.S. 226 (1897) ............. 13

Coniston Corporation v. Village of Hoffman Estates,

Ob as Se A es Bs cbinceecédecccess 12,14

Daniels v. Williams, 474 U.S. 327 (1986) ......... 14-16

DeBlasio v. Zoning Board of Adjustment for

the Township of West Amwell, 53 F.3d 592

ee ae ah ane o bse t eee eee 6 10

Dolan v. City of Tigard, 512 U.S. __,

Sh Pr soci Se cb eaence senses ii,14

First English Evangelical Lutheran

Church of Glendale v. County of

Los Angeles, 482 U.S. 304 (1987)........... era

Fuentes v. Shevin, 407 U.S. 67 (1972) ........... 14-15

Page

Goldberg v. Kelly, 397 U.S. 254 (1970) .......... 15,19

Hall v. Tawney, 621 F.2d 607 (4th Cir. 1980).......... 9

Hartland Sportsman’s Club, Inc. v. Town of

Delafield, 35 F.3d 1198 (7th Cir. 1994) ............ 11

Hudson v. Palmer, 468 U.S. 517 (1984) ............ 17

Johnson v. Glick, 481 F.2d 1028 (2d Cir. 1973) ........ 9

Lawton v. Steele, 152 U.S. 133 (1894) ............. 10

Lockary v. Kayfetz, 908 F.2d 543 (9th Cir. 1990) ....... ii

Logan v. Zimmerman Brush Co., 455 U.S. 422 (1982) ... 19

LRL Properties v. Portage Metro Housing

Authority, 55 F.3d 1097 (6th Cir. 1995) ............ 9

Marks v. City of Chesapeake, Virginia,

Gee Pe ee Ge as SUE ete da we rectccess 10,12

Marshall v. Jerrico, Inc., 446 U.S. 238 (1980) ........ 19

Nectow v. City of Cambridge, 277 U.S. 183 (1928) ..... 10

Nollan v. California Coastal Commission,

ge ee ae er eee ii,14

Parratt v. Taylor, 451 U.S. 527 (1981) .......... 6, 16-18

Pennell v. City of San Jose, 485 U.S. 1 (1988) ......... ii

ix

Page

PFZ Properties, Inc. v. Rodriguez,

928 F.2d 28 (lst Cir.), cert. granted,

502 U.S. 956 (1991), cert. dismissed,

Pe ES PCO See be bbw eee es pees ii,7-8

Pittsley v. Warish, 927 F.2d 3 (Ist Cir. 1991) .......... )

Rochin v. People of California, 342 U.S. 165 (1952)..... 7-8

Santa Monica Beach, Ltd. v. Superior Court,

Oe ae Us EE SEM Pic ccc ke seer esac. iii

Shelton v. City of College Station,

Pe ee rhc hc dec edccecevas 12

Sierra Lake Reserve v. City of Rocklin,

938 F.2d 951 (9th Cir. 1991), cert. granted

and remanded, reversed on other grounds,

Se ee EE Sele tewedecece 10

Stubblefield Construction Co. v. City of

San Bernardino, 32 Cal. App. 4th 687 (1995) ........ 11

Triomphe Investors v. City of Northwood,

SR RNR 12

Williamson County Regional Planning

Commission v. Hamilton Bank of Johnson

eR By NR ee 14

Yee v. City of Escondido, 503 U.S. 519 (1992) ........ iii

Page

Statutes

WUC. FNS... 5 FO ee ie ed 3,6,20

fo Peerrorer rr ey rl a eee ee 3,20

Rules

No. 95-1980

In the

Supreme Court of the United States

October Term, 1995

—>

DAVID RIVKIN, EDWARD RIVKIN,

JUDITH RIVKIN, t/a GALAXY MANOR,

A New Jersey Partnership,

Petitioners,

Vv.

DOVER TOWNSHIP RENT LEVELING BOARD,

Respondent.

+

Petition for Writ of Certiorari

to the New Jersey Supreme Court

+

BRIEF AMICUS CURIAE OF

PACIFIC LEGAL FOUNDATION IN SUPPORT

OF PETITION FOR WRIT OF CERTIORARI

ea

STATEMENT OF THE CASE

When petitioners David, Edward, and Judith Rivkin,

in partnership as Galaxy Manor (Rivkins), submitted an

application for a rent increase to respondent Dover Township

Rent Leveling Board (Rent Board) in May, 1990, they

1

2

expected a simple, noncontroversial process. They had

records demonstrating expenses of $59,624.96; the Rivkins

believed these were for capital improvements that could be

recovered through an increase in the rents paid by the tenants

of their mobile home park, under the local mobile home rent

control ordinance. The job of the five members of the Rent

Board was clear: to review the application and determine

how many of the expenses fit in the category of major capital

improvements.

But over the course of four public hearings--in June,

July, August, and October, 1990--the Rivkins found that

instead of being composed of five neutral arbiters of their

claims, the Rent Board-contained one member who viewed

his role as “one of advocacy rather than adjudication."

Rivkin v. Dover Township Rent Leveling Board, 143 N.J.

352, 358 (1996); Appendix (App.) A to Petition for Writ of

Certiorari (Pet.) at 4a. The Rent Board is comprised of three

members from the general public, one mobile home park

owner, and one mobile home park tenant. The tenant

member, one Mr. Baltarzuk--who happened to reside at the

very park for which the rent increase was sought--"stated on

the record that it was his function to ‘serve the people of the

mobile home park.’" Rivkin, 143 N.J. at 358-59, App. A to

Pet. at 4a. The tenant member’s “manner was threatening to

the Rivkins," and he berated their attorney, introduced

evidence that was outside the record, and “in essence,

offered himself as a witness concerning certain items." Id.

at 359, App. A to Pet. at 4a-Sa. The Rivkins’ pleas to the

Rent Board that this partisan member be disqualified from

judging their case fell on deaf ears.

After the Rent Board voted to allow a rent increase to

offset only $20,641.42 of the expenses, the Rivkins

challenged the Rent Board’s decision by filing a lawsuit in

the New Jersey trial court. The lawsuit contained both a

cause of action under New Jersey law to review local agency

decisions--called an action in lieu of prerogative writs--and

3

a federal law cause of action under 42 U.S.C. § 1983,

alleging violations of the constitutional guarantees of due

process and equal protection.? The trial court found that

“Baltarzuk’s misconduct and manifest bias had tainted the

proceedings," Rivkin, 143 N.J. at 360, App. A to Pet. at 6a,

and the matter was remanded back to the Rent Board for a

rehearing without the biased member. This time, the Rent

Board approved a rent increase of $45,731.09, more than

doubling its previous determination of major capital

improvements and giving the Rivkins more than 75% of their

request.

The Rivkins then returned to trial court, which found

that the Rent Board had violated the Rivkins’ due process

rights, supporting an award of $6,303.34 in compensatory

damages and $39,679.55 in attorneys’ fees under 42 U.S.C.

§ 1983 and § 1988. App. C to Pet. at 54a. The trial court

found that the biased member’s “actions permeated the

board, that the board allowed his actions and comments to

affect their judgment in the case and therefore the board was

recalcitrant with respect to this matter." App. D to Pet.

at 58a. The trial court concluded that the bias of the tenant

member "permeated the whole decision of the board," which

should not have allowed him to participate in the

proceedings. Id.

The Rent Board appealed this decision to the Superior

Court of New Jersey for the Appellate Division, which

reversed the judgment on the ground that the biased Rent

Board member’s actions were “random and unauthorized"

and that the state law “action in lieu of prerogative writs"

was an adequate post-deprivation remedy providing all the

process the Rivkins were due. App. B to Pet. at 51a.

The New Jersey Supreme Court granted the Rivkins’

petition for certification and affirmed the appellate court in

2 This brief addresses only the due process issues presented in this case.

SE

4

an opinion issued February 29, 1996. The New Jersey

Supreme Court considered the alleged due process violations

under separate substantive and procedural due process

analyses. Under the former, the court rejected the “arbitrary

and irrational" standard for violations used by several

Circuits in favor of the “shocks the conscience” standard.

The court prejudged the case, stating prior to its analysis

that, "we believe that the denial of a property right in the

context of municipal governance rarely will rise to the level

of a substantive due process violation," Rivkin, 143 N.J.

at 366, App. A to Pet. at 13a.

Taking out of context this Court’s standards for

evaluating alleged infringements on liberty by law enforce-

ment personnel enforcing criminal laws, and inappropriately

focusing just on the conduct of the biased member, the

New Jersey Supreme Court found no substantive due process

violation. Id. at 366, App. A to Pet. at 14a. It rationalized

that the biased Rent Board member “appears to have

mistakenly believed that it was his duty to serve as a tenants’

advocate. From this mistaken premise, Baltarzuk’s actions

were rational." Jd. at 370, App. A to Pet. at 19a. The court

closed its substantive due process analysis by baldly

announcing:

Until [United States Supreme Court] clari-

fication, ... we seriously doubt that the

Supreme Court will find a substantive due

process violation to exist when a governmental

body denies a property right by conduct that is

“arbitrary or irrational” under state law but

neither shocking to the conscience of a court

in a sense of being a departure from civilized

norms of governance, nor offensive to human

dignity.

Rivkin, 143 N.J. at 371, App. A to Pet. at 20a.

5

Turning to the issue of procedural due process,

New Jersey’s highest court held that a fair predeprivation

hearing was not required, since the biased member’s actions

were random and unpredictable, and thus the availability of

the post-deprivation remedy successfully used by the Rivkins

to reverse the Rent Board’s decision provided all the due

process they deserved. This incredible conclusion was

reached even though it was an actual hearing which deprived

the Rivkins of their property rights, at which these

"unanticipated" actions were trumpeted before the entire Rent

Board--who condoned the bias by refusing to disqualify

Baltarzuk. The court denied the significance of the actions

of the entire Rent Board, and even downplayed the impact of

the biased member’s advocacy role: “Perhaps Baltarzuk’s

disqualification should have come at an earlier stage."

143 N.J. at 384, App. A to Pet at 36a. Perhaps a biased

judge should not have participated in the deliberations and

determination of the Rivkins’ property rights?

The Rivkins were injured twice. First, the Rent Board

improperly denied the bulk of their rent increase request,

following the lead of an admittedly biased and self-interested

board member. Then, the New Jersey Supreme Court told

them that property deprivations do not sufficiently trouble (or

shock) its collective conscience so as to implicate due

process, and that a hearing that deprived the Rivkins of

property is a random, unanticipated act that does not violate

due process standards as long as some postdeprivation

remedy is available. The Rivkins responded by filing a

petition for writ of certiorari, which amicus curiae supports

with the present brief.

+

SUMMARY OF ARGUMENT

The "shocks the conscience" standard, adopted by the

New Jersey Supreme Court for evaluating claims of property

6

deprivation without due process, should never have been

lifted from its context of evaluating acts of force or physical

restraint by government officials empowered to use such

methods. The use of this standard creates a conflict with

several Circuit Courts of Appeals which evaluate property

regulations to insure that they are not arbitrary, capricious,

or irrational. Under the latter standard, a procedural

requirement that administrative boards provide a legitimate,

articulated reason for their decisions to restrict property

rights would facilitate court review. In the absence of such

a requirement, the procedural rights to a hearing at which an

applicant has the opportunity to be heard and to submit

evidence are rather hollow rights.

When a government agency deprives citizens of

property rights through a public hearing, this action cannot

be excused due to the availability of postdeprivation

remedies. This Court’s Parratt doctrine was designed for

circumstances in which a predeprivation hearing is imprac-

ticable, and has no application in circumstances when such

a hearing has in fact taken place. The participation of a

biased, partisan decision maker in such a proceeding violates

due process and can be remedied through a civil rights suit

under 42 U.S.C. § 1983.

+

7

ARGUMENT

I

THIS COURT SHOULD RESOLVE THE

CONFLICTS OVER WHETHER THE DUE

PROCESS CLAUSE PROTECTS PROPERTY

OWNERS FROM ARBITRARY AND

CAPRICIOUS GOVERNMENT RESTRICTIONS

OF THEIR PROPERTY RIGHTS

The New Jersey Supreme Court has announced that

deliberate, arbitrary decisions by government bodies to

restrict property rights do not violate the due process

guarantee of the Fourteenth Amendment. That Court bases

this decision on Rochin v. People of California, 342 U.S.

165, 172-74 (1952). See Rivkin, 143 N.J. at 371, App. A to

Pet. at 20a. New Jersey acknowledges that at least four

Circuit Courts of Appeals have adopted a conflicting

standard, id. at 368-69, App. A to Pet. at 17a-18a, but

announces it will follow a “shocks the conscience" test until

this Court says otherwise. Given the fundamental importance

of the rights at stake, the Petition for Writ of Certiorari

should be granted to settle these conflicts.

A. The "Shocks the Conscience" Test for

Due Process Violations, Originating with

the Rochin Opinion, Was Designed for the

Context of Liberty Infringements in the

Course of Crime Detection and Punishment and

Is Inappropriate for Property Rights Violations

In the opinion below, the New Jersey Supreme Court

joins the First Circuit Court of Appeals in importing the

“shocks the conscience" standard into the due process

analysis of property deprivations. Rivkin, 143 N.J. at 371,

App. A to Pet. at 20a. New Jersey has gone even farther

than the First Circuit, which at least recognized an alternative

test: “action that is legally irrational in that it is not

sufficiently keyed to any legitimate state interests." PFZ

8

Properties, Inc. v. Rodriguez, 928 F.2d 28, 31-32 (1st Cir.

1991) (internal quotation marks and citation omitted), cert.

granted, 502 U.S. 956 (1991), cert. dismissed, 503 U.S. 257

(1992).

The New Jersey court adopted a test that does not fit

comfortably in the property rights context. In Rochin, this

Court grappled with the question of whether certain actions

by the police to obtain evidence of a crime concealed by a

criminal suspect would violate due process. The police tried

forcibly to remove the drug crime evidence from the

suspect’s mouth when he was swallowing it, and then took

the suspect to the hospital so that his stomach would be

pumped with liquid to induce vomiting and thereby disgorge

the contraband. Rochin, 342 U.S. at 166.

The Rochin Court recognized that "the administration

of criminal justice is predominately committed to the care of

the States," id. at 168, and that there exists "the compre-

hensive right of States to fashion their own rules of evidence

for criminal trials," id. at 173. Given this context, and the

obvious fact that law enforcement entails the use of force by

government employees in a necessarily improvisational

manner, the Court was careful to circumscribe any vehicle,

such as due process challenges, that interfered with this basic

and inherently dangerous responsibility of the states.

The Rochin Court’s solution was to hold that action by

police on the streets restricting liberty would violate due

process if it could be said that it was "conduct that shocks

the conscience," as opposed to actions that merely “offend

some fastidious squeamishness or private sentimentalism

about fighting crime too energetically." Rochin, 342 U.S.

at 172. The word “shocks” is employed because of the

context: the messy business of crime-fighting. In Rochin, the

Court found that the police officers used “methods too close

to the rack and the screw to permit of constitutional

differentiation," id., a quote which the New Jersey Supreme

9

Court severs from its context and submits as the definition of

“substantive due process violations" in general. Rivkin,

143 N.J. at 366, App. A to Pet. at 14a.

The “shocks the conscience" standard is at once elastic

(depending upon the subjective feeling of judges) and

exacting (in setting a high threshhold) and should be confined

to the context of alleged liberty infringements by government

employees whose position requires the use of some physical

force or restraint. See, e.g., Pittsley v. Warish, 927 F.2d 3,

6 (1st Cir. 1991) (alleged rude and threatening conduct by

police officers); Hall v. Tawney, 621 F.2d 607, 613 (4th Cir.

1980) (corporal punishment by teacher); Johnson v. Glick,

481 F.2d 1028, 1033 (2d Cir. 1973) (alleged violent actions

by prison guard). When employed in the context of an

alleged deprivation of property, the very language of this test

becomes almost laughable. See LRL Properties v. Portage

Metro Housing Authority, 55 F.3d 1097, 1111 (6th Cir.

1995) (denial of apartment owners’ right to receive federa:

low-income housing subsidies does "not even approach the

level of ‘shocks the conscience’").

The "shocks the conscience" test is simply inappro-

priate when the acts to be evaluated are not acts of physical

force or coercion. Judges should be troubled when govern-

ment bodies act to interfere intentionally with the right of an

individual to enjoy the use of his property. But visceral

discomfort with the result of a government decision to limit

property rights should not be the basis for due process

determinations when a more objective standard is at hand.

B. Government Decisions That

Restrict Property Rights Should be

Scrutinized to Determine if the Actions

Are Arbitrary, Capricious, or Irrational

Several circuits take an approach to due process

protections of property rights that, upon reflection, is far less

subjective than a test based on whether a panel of judges’

10

consciences are sufficiently shocked. These courts look to

see if a government body’s decision to restrict property rights

was arbitrary, capricious, or irrational. See, €.2.,

DeBlasio v. Zoning Board of Adjustment for the Township of

West Amwell, 53 F.3d 592, 601-02 (3rd Cir. 1995); Sierra

Lake Reserve v. City of Rocklin, 938 F.2d 951, 957-58

(9th Cir. 1991), cert. granted, judgment vacated, and

remanded, __ U.S. __, 113 S. Ct. 31 (1992), reversed on

other grounds, 987 F.2d 662 (9th Cir. 1993); Marks v. City

of Chesapeake, Virginia, 883 F.2d 308, 309 (4th Cir. 1989);

Brady v. Town of Colchester, 863 F.2d 205, 215-16 (2d Cir.

1988).

Arbitrary, capricious, or irrational decisions either

lack a legitimate justification, have an illegitimate purpose,

or cannot even be explained after the fact. It has long been

considered the duty of our courts to scrutinize a decision-

making process that restricts property rights to see if a

legitimate purpose has been served. Due process embraces

the fundamental concept that certain government decisions

must relate to a legitimate end of government and may not be

made for no reason or for a bad reason. See Nectow v. City

of Cambridge, 277 U.S. 183, 188 (1928); Lawton v. Steele,

152 U.S. 133, 136-37 (1894). This concept is the essential

difference between the rule of law and arbitrary government,

between a government of laws and one of men.

When a government agency conducts public hearings

on an application and then makes a deliberate decision

concerning property owners’ use of their property, it is not

too much to ask that the government supply a reason for its

actions. If no reason is given, then that action is arbitrary.

If the apparent reasons are impermissible, then that action is

capricious. If the reason is nonsensical, then that action is

irrational. If courts were to employ this approach, then due

process review would be more objective and comprehensible.

11

The New Jersey Supreme Court in this case rejected

the “arbitrary and irrational" test, because:

In the land use context, the phrases “arbitrary

and irrational” or “capricious” are often

shorthand expressions for a standard of review

that asks whether there are sufficient facts in

the record to support the agency’s action or

whether the agency has followed its legislative

mandate.

Rivkin, 143 N.J. at 369, App. A to Pet. at 18a (citation

omitted). To the court below, a government agency does not

violate due process when its actions are insupportable or ultra

vires.

The New Jersey Supreme Court even appears to reject

the rational basis test for property deprivations. It cited to

opinions of the Eighth Circuit, which makes a distinction

between the merely irrational and the “truly irrational"--the

latter being the sort of decision to restrict property rights that

could possibly violate due process. Id. at 370, App. A to

Pet. at 19a; see Chesterfield Development Corporation v. City

of Chesterfield, 963 F.2d 1102, 1104-05 (8th Cir. 1992).

The Eighth Circuit is not alone in requiring something more

than the irrational for a property restriction to violate the

Constitution. See, e.g., Hartland Sportsman’s Club, Inc. v.

Town of Delafield, 35 F.3d 1198, 1202 (7th Cir. 1994);

Amsden v. Moran, 904 F.2d 748, 757 (1st Cir. 1990).

The foregoing shows that even under an arbitrary and

irrational test, there still remain questions as to how

"irrational" conduct is to be defined for due process

purposes. In the opinion below, the Court concluded that the

actions of the biased individual “were rational" under his

mistaken belief that his role was to abuse mobile home park

owners. Rivkin, 143 N.J. at 370, App. A to Pet. at 19a.

Other courts agree that it is rational for decision makers to

carry water for their constituents. See, e.g., Stubblefield

12

Construction Co. v. City of San Bernardino, 32 Cal. App.

4th 687, 696 (1995); Triomphe Investors v. City of

Northwood, 49 F.3d 198, 202 (6th Cir. 1995); Coniston

Corporation v. Village of Hoffman Estates, 844 F.2d 461,

467 (7th Cir. 1988). Still others find such motivations

impermissible. Marks, 883 F.2d at 309; Bello v. Walker,

840 F.2d 1124, 1129 (3d Cir. 1988).

This Court should settle these conflicts and decide if

due process requires that governments not act arbitrarily or

maliciously when deciding to curtail the property rights of

their citizens.

I

THIS COURT SHOULD CLARIFY

WHETHER DUE PROCESS REQUIRES

ADMINISTRATIVE DETERMINATIONS

THAT RESTRICT PROPERTY RIGHTS

TO BE BASED ON LEGITIMATE,

ARTICULATED JUSTIFICATIONS

The Rivkin case presents this Court with the

opportunity to address a most fundamental question con-

cerning the meaning of the Due Process Clause for property

owners navigating through the administrative process. As the

foregoing demonstrates, circuits are at odds over whether

arbitrary, capricious, or irrational regulation of property

violates due process. But even if this Court settles the

question by rejecting the "shocks the conscience” standard,

a big question still remains: How will courts determine if a

government decision is arbitrary, capricious or irrational?

Will they look to the actual grounds for the decision, see

Brady, 863 F.2d 215-16 (trier of fact to decide if permit

decision was based on impermissible grounds) or instead

supply their own rational basis by hypothesis, see Shelton v.

City of College Station, 780 F.2d 475, 482 (Sth Cir. 1986)

(holding "a zoning decision can be justified by hypothesized

13

purposes" but acknowledging that for "protected property

interests" a “later procedural due process inquiry might

require a zoning board to point to a rational basis").

As the New Jersey Supreme Court recognized,

"[a}nalytically the Rivkins’ case is much closer to a proce-

dural due process claim," than a substantive due process

claim. Rivkin, 143 N.J. at 371, App. A to Pet. at 20a. The

reason that an arbitrary decision was reached by the Rent

Board was that one of its members chose not to consider the

evidence in a neutral manner but instead personally chose to

be the "adversary" in an adversarial process. This Court

should consider whether administrative determinations

affecting property rights require a certain result that is

procedural in nature--namely, an articulated, legitimate

justification for the determination. This final step in the

process facilitates review by the courts but does not entail the

substitution of a court’s judgment concerning policy matters

for the judgment of a regulatory body. This final step is

consistent with the traditional approach taken by this Court

to the constitutional protection of property rights.

This Court has long recognized that a special,

particular process is "due" when property rights are at stake.

In Chicago, Burlington & Quincy Railroad Co. v. City of

Chicago, 166 U.S. 226, 241 (1897), it was held that due

process requires that property taken by the government for

public purposes be acquired by payment of just compen-

sation. The Court explained, “The mere form of the

proceeding instituted against the owner, even if he be

admitted to defend, cannot convert the process used into due

process of law, if the necessary result be to deprive him of

his property without compensation.” 166 U.S. at 236-37.

Similarly, if government regulation effects a taking of

property, the government must pay just compensation for the

time period in which the property owner was subject to the

unconstitutional action--"temporary takings" compensation.

14

First English Evangelical Lutheran Church of Glendale v.

County of Los Angeles, 482 U.S. 304, 322 (1987).

The importance of the substantive outcome in cases

involving property rights is not derived from the policy

choices of judges, but from the choice made by the people of

this nation in including protection of property rights in the

Bill of Rights. “[T]he prohibition against the deprivation of

property without due process of law reflects the high value,

embedded in our constitutional and political history, that we

place on a person’s right to enjoy what is his, free of govern-

mental interference." Fuentes v. Shevin, 407 U.S. 67, 81

(1972) (citation omitted).’

Unlike the wide ranging and often controversial

interests asserted in the context of alleged liberty depriva-

tions, property rights are matters of settled common law and

are most frequently restricted in the course of quasi-judicial,

administrative processes. As this Court noted in Daniels v.

Williams, “{hjistorically, this guarantee of due process has

been applied to deliberate decisions of government officials

to deprive a person of life, liberty, or property." 474 U.S.

327, 331 (1986) (citation omitted; emphasis in original). The

Due Process Clause “‘"was intended to secure the individual

from the arbitrary exercise of the powers of government.”’"

Id. (citation omitted). If government conducts a hearing in

> Property rights receive heightened protection under the Takings Clause,

as the regulation of the use and enjoyment of property must have more

than a mere hypothetical connection with a legitimate end of government--

it must in actuality “substantially advance” such an end. Dolan v. City

of Tigard, 512 U.S. __, 129 L. Ed. 2d 304, 316 (1994); Nollan v.

California Coastal Commission, 483 U.S. 825, 833 n.3 (1987); Agins v.

City of Tiburon, 447 U.S. 255, 260 (1980). However, that clause is no

substitute for the Due Process Clause, under which payment of actual

damages for government mistreatment can be obtained. See Williamson

County Regional Planning Commission v. Hamilton Bank of Johnson City,

473 U.S. 172, 197 (1985); Coniston Corporation v. Village of Hoffman

Estates, 844 F.2d at 464.

15

| a deliberate manner that results in a restriction of property

| rights, then due process should require that the reasons

behind the property rights restrictions be publicly articulated

by the government body.

| This procedural requirement serves two purposes. If

a government body must verbalize its reasoning, “substan-

| tively unfair and simply mistaken deprivations of property

interests can be prevented." Fuentes, 407 U.S. at 81

(discussing importance of notice and opportunity to be

heard). Second, an official statement by the regulatory body

will enable courts to determine if the grounds justifying a

decision are within the jurisdiction of the government

agency, or are instead an ultra vires action. When property

regulators act through the administrative process to determine

the property rights of individuals, it is not much of an impo-

sition to require that “the decision maker should state the

reasons for his determination and indicate the evidence he

relied on." Goldberg v. Kelly, 397 U.S. 254, 271 (1970)

(discussing state termination of welfare benefits).

In this particular case, if the Rent Board had been

required to state the reasons for its decision and that state-

ment revealed that the evidence and arguments proffered by

Baitarzuk were the basis for the diminished rent increase, the

violation of due process would be clear and obvious and

would require no amount of hypothesizing by the courts.

Given the fundamental importance of private property rights

and the need to provide an anchor for judicial review of

administrative decisions affecting these rights, this Court

‘ should grant the petition for writ of certiorari in order to

establish that a statement of reasons is necessary as a bright

line procedural requirement.

16

iil

THIS COURT SHOULD DETERMINE WHETHER

A PROCEDURALLY INADEQUATE HEARING IN

WHICH A BIASED MEMBER PARTICIPATES

VIOLATES DUE FROCESS OR IS INSTEAD

SUBJECT TO THE PARRATT DOCTRINE

The New Jersey Supreme Court held that the Rent

Board’s decision to wrongfully deny the Rivkins’ rent

increase application, reached with the full participation of a

biased member whose actions “permeated the whole deci-

sion," App. D to Pet. at 58a, was not a violation of the

Rivkins’ right to procedural due process. The court

purported to be applying the doctrine of Parratt v. Taylor,

451 U.S. 527 (1981), which held that a predeprivation

hearing with all the trappings of due process is not required

for property deprivations accomplished by “a random and

unauthorized act by a state employee,” since “[iJn such a

case, the loss is not a result of some established state

procedure and the State cannot predict precisely when the

loss will occur." Id. at 541. The New Jersey court has

misapplied the Parratt doctrine in a manner which disserves

the reasoning behind the doctrine.

A. Deliberate Decisions by a Government

Body in the Course of a Public Hearing

Are Not Random, Unauthorized Acts

The Parratt Court considered whether the negligent

loss of a prisoner’s mail-order hobby kit by prison mail room

employees was a deprivation of the prisoner’s property with-

out due process of law.* Essentially, the issue was whether

a state government had the duty to conduct a hearing, with

“ In Daniels v. Williams, 474 U.S. at 334-36, this Court overruled

Parratt on the issue of whether negligent government acts could violate

due process, finding in the negative.

7

17

notice and the opportunity to be heard, for a prisoner prior

to misplacing his mail. Quite obviously, a hearing is impos-

sible under such circumstances, as the act of negligence was

"im almost all cases beyond the control of the State."

Parratt, 451 U.S. at 541.

Three years later, this Court extended the Parratt

doctrine to certain intentional deprivations, as "[t]he state can

no more anticipate and control in advance the random and

unauthorized intentional conduct of its employees than it can

anticipate similar negligent conduct." Hudson v. Palmer,

468 U.S. 517, 533 (1984). Significantly, this Court added:

"Arguably, intentional acts are even more difficult to

anticipate because one bent on intentionally depriving a

person of his property might well take affirmative steps to

avoid signalling his intent.” Id.

The property deprivation in the Rivkin case was

accomplished not by some maverick government official

acting on his own without knowledge of his agency, but was

committed by an entire administrative board during the

course of four public hearings. The biased member of the

Rent Board, who acted as an advocate against the interests of

the applicant (and for his own interests, as a resident of the

subject mobile home park), did not attempt to hide from the

rest of the Rent Board his antagonistic position: “He stated

on the record that it was his function to ‘serve the people of

the mobile home park.’" Rivkin, 143 N.J. at 358-59,

App. A to Pet. at 4a.

The deprivation of property in these circumstances

was not the result of a random act of a government employee

occurring beyond the supervision of his department

superiors, but was instead the result of an official action of

the very agency in question. Had Baltarzuk taken the only

copies of the Rivkins’ application for a rent increase and

destroyed them without knowledge of the rest of the Rent

Board, then the Parratt doctrine would come into play and

ee ee a

13

the availability of postdeprivation remedies would be

sufficient process. But when an entire Rent Board, acting in

its official capacity and through a series of public hearings

and deliberations, deprives citizens of property the mere

availability of postdeprivation remedies is not enough.

The Rent Board was not faced with an unpredictable

occurrence--the deprivation was in the course of hearings

designed to determine whether or not a rent increase will be

allowed. It certainly knew that the deprivation was taking

place. It certainly knew that a biased member was poisoning

the process, as he admitted his wrongful view of his role on

the record at these hearings. If official hearings to consider

a rent increase application is not an official government pro-

cedure, then it is hard to imagine what would qualify as one.

The point of the Parratt doctrine is that the

government cannot be expected to convene a hearing prior to

every isolated act of its employees that deprives citizens of

their property. But if a hearing is practicable and the

government agency does have one, that hearing must

comport with due process.

B. Failure to Disqualify a Biased Member

from an Administrative Decision Taints

the Proceedings and Deprives Applicants

of Their Right to Due Process

The Rivkin court held that the process provided the

Rivkins by the Rent Board was not inadequate merely

because an openly-biased member “behav[ed] as a tenant

advocate and introduc[ed] evidence from outside the record,”

while participating in a decision to deny the Rivkins the bulk

of the rent increase to which they were entitled. Rivkin,

143 N.J. at 377, App. A to Pet. at 28a. The Court achieved

this result by its finding that Baltarzuk’s actions were not

required by the terms of the local rent control ordinance, and

thus cannot be said to have resulted from~ the state

procedures.

19

But the critical issue below was not whether due

process is violated by having a Rent Board member come

from the ranks of mobile home park tenants. The issue was

whether the Rivkins were entitled to have their rent increase

application considered by neutral, disinterested government

officials. "The Due Process Clause entitles a person to an

impartial and disinterested tribunal in both civil and criminal

cases. ... The neutrality requirement helps to guarantee that

life, liberty, or property will not be taken on the basis of an

erroneous or distorted conception of the facts or the law."

Marshall v. Jerrico, Inc. , 446 U.S. 238, 242 (1980). “[T]he

Due Process Clause grants the aggrieved party the opportun-

ity to present his case and have its merits fairly judged."

Logan v. Zimmerman Brush Co., 455 U.S. 422, 433 (1982)

(emphasis added). See also Goldberg, 397 U.S. at 271 ("of

course, an impartial decision maker is essential").

This Court should grant the Petition for Writ of

Certiorari to determine whether administrative boards can

include biased, partisan, and self-interested members in the

decision to restrict the property rights of applicants. The

New Jersey Supreme Court took as given the established

facts that Baltarzuk was biased against the Rivkins, intro-

duced evidence from outside the record, and had such an

impact on the board that his actions “permeated the whole

decision." Does this amount to due process, or is it an

affirmative injury to the Rivkins’ constitutionally protected

interests by their government?

ae

CONCLUSION

An administrative board, after four public hearings,

decided to deny the bulk of a rent increase application

submitted by petitioners. This decision was reversed by a

trial court, which found that the participation of a biased

20

member of the board--who introduced evidence from outside

the record, argued with and berated petitioners’ attorney, and

proclaimed his role to be one of advocate rather than

adjudicator--was determinative of the outcome, in violation

of petitioners’ due process rights. The trial court

subsequently awarded damages and attorneys’ fees under

42 U.S.C. §§ 1983, 1988.

After an appellate court threw out this award, the

New Jersey Supreme Court affirmed the appellate decision.

That court based its decision on the view that property rights

violations cannot "shock the conscience" and that the actions

of the board were random, unauthorized, and unpredictable.

This decision employs the Rochin standard improperly and

rejects the “arbitrary and capricious" standard for due

process claims used by several federal appellate courts.

Further, it inappropriately employed the Parratt doctrine--

which excuses the absence of predeprivation hearings when

such a hearing is impracticable--in a case in which there

actually was a predeprivation hearing.

In order to settle the conflicts created by the Rivkin

opinion and bring some clarity to an increasingly muddled

area of the law, amicus respectfully requests that this Court

grant the petition for writ of certiorari.

DATED: July, 1996.

Respectfully submitted,

JAMES S. BURLING

*VICTOR J. WOLSKI

*Counsel of Record

Pacific Legal Foundation

2151 River Plaza Drive,

Suite 305

Sacramento, California 95833

Telephone: (916) 641-8888

Attorneys for Amicus Curiae