(This syllabus is not part of the opinion of the Court. It has been prepared by the Office of the Clerk for
the convenience of the reader. It has been neither reviewed nor approved by the Supreme Court. Please
note that, in the interests of brevity, portions of any opinion may not have been summarized).
Argued February 2, 1998 -- Decided June 2, 1998
GARIBALDI, J., writing for a majority of the Court.
At issue in this appeal is whether the New Jersey Alternative Procedure for Dispute Resolution Act
(APDRA), N.J.S.A. 2A:23A-1 to -19, infringes on an individual's constitutional right to appeal and on the
Supreme Court's constitutional rulemaking authority.
The events that led to this appeal began when parties to various contracts to develop a 1280-acre
tract of land in Rockaway Township, Morris County became involved in litigation against one another over
aspects of the project and entered into a settlement agreement, embodied in a consent judgment, in 1989 to
resolve the litigation. Paragraph 13 of the consent judgment called for the parties to submit any dispute
regarding their rights and obligations for resolution under the APDRA. Despite the settlement agreement,
the parties' differences were not resolved. Mt. Hope Development Associates (MHDA), the joint venture
entity formed by the parties, filed suit in the Chancery Division of Superior Court against some of the parties
involved in the projects. Those parties then moved to compel alternative dispute resolution under the 1989
consent judgment. By court order, the Chancery proceedings were stayed and the parties directed to proceed
under the APDRA.
Over the course of twenty days in 1994, the umpire, a retired Superior Court Judge, heard extensive
testimony and considered hundreds of exhibits relative to the parties' claims of breach of contract,
conspiracy, tortious interference with contract, and fraud. The umpire ruled in favor of defendants, making
interim and final written awards and orders, supported by findings of fact and conclusions of law. MHDA
moved in the Chancery Division to vacate or modify the award and defendants moved to confirm the award.
The court confirmed the award. MHDA filed an appeal with the Appellate Division, which defendants sought
to dismiss on the grounds that under the APDRA, MHDA had waived the right to appeal. The Appellate
Division dismissed the appeal as barred by the APDRA and the Supreme Court granted certification.
HELD: The New Jersey Alternative Procedure Dispute Resolution Act (APDRA) does not infringe on the
constitutional right to appeal or on the constitutional authority of the Supreme Court to adopt rules
governing the courts. The parties to this appeal, who voluntarily agreed to have their disputes resolved under
the APDRA and did not preserve in their agreement a right to appeal, waived their right to appeal.
1. The APDRA provides a voluntary procedure for resolving disputes in a formal manner without the costs
and delays of traditional litigation. Discovery is permitted under the APDRA and the umpire's award is to
address all issues submitted, be based on substantive legal principles, be in writing, and be accompanied by
findings of fact and conclusions of law. The parties are permitted to move before the Chancery Division of
Superior Court to vacate, correct, or modify the award, but once the award is confirmed, modified, or
corrected by order and the court enters a judgment in conformity with the order, the APDRA provides “
[t]here shall be no further review of the judgment or decree.” N.J.S.A. 2A:23A-18(b). (pp. 5-6)
2. The right to appeal guaranteed by the New Jersey Constitution, like other constitutional rights, may be waived. The intention to do so must be clear and supported by consideration. Express references in the APDRA to limitations on appeals and the legislative history of the statute make clear to those opting to proceed under the APDRA that by doing so, they are giving up their right to appeal. The parties to the consent judgment in this case are sophisticated and were represented by counsel when they agreed to resort
to the APDRA to resolve their differences. They did not reserve in the consent judgment a right to appeal.
They did not object to proceeding under the APDRA while the proceedings were ongoing. (pp. 6-11)
3. The Supreme Court is vested by the New Jersey Constitution with exclusive jurisdiction to administer the
courts of the state. The Court acknowledges that in maintaining the separation of powers among the three
branches of government, there should be “cooperative accommodation.” Rule 2:2-3(a)(1), which grants the
right to appeal to the Appellate Division a final judgment of the Chancery or Law Division, implements the
constitutional right to appeal; like the constitutional right, that right may be waived. The Court does not
find that by enacting the APDRA, a voluntary system of procedures for resolving disputes, the Legislature
attempted to intrude on the rulemaking authority of the Court. Moreover, by enacting the APDRA, the
Legislature has furthered the strong public policy in favor of developing desirable alternatives to litigation.
(pp. 11-14)
4. The parties knowingly submitted their disputes for resolution under the APDRA, which forecloses any
right to appellate review, so the Appellate Division properly dismissed the appeal. (p. 15)
Judgment of the Appellate Division is AFFIRMED.
JUSTICE STEIN, concurring and dissenting, approves of the Court's interpretation of the APDRA
to permit parties who agree to proceed under the Act either to preserve or to waive the constitutional right
of appeal, but would permit the appeal to proceed in this case because when the parties agreed to be bound
by the APDRA's procedures, the right to appellate review under the Act had not been established. The
waiver of the right of appeal was neither clear nor explicit.
CHIEF JUSTICE PORITZ and JUSTICES HANDLER, POLLOCK, O'HERN, and COLEMAN
join in JUSTICE GARIBALDI's opinion. JUSTICE STEIN filed a separate concurring and dissenting
opinion.
SUPREME COURT OF NEW JERSEY
A-
77 September Term 1997
MT. HOPE DEVELOPMENT ASSOCIATES,
EAJ, INC., and HUNDAL CORPORATION,
Plaintiffs-Appellants,
v.
MT. HOPE WATERPOWER PROJECT, L.P.,
MT. HOPE MINING COMPANY, INC.,
HALECREST COMPANY, MT. HOPE HYDRO
INC., MT. HOPE PROPERTIES, INC.,
KVAERNER HYDRO POWER, INC. and
PAUL RODZIANKO,
Defendants-Respondents,
and
ATTORNEY GENERAL OF NEW JERSEY,
Intervenor-Respondent,
and
ABB GENERATION, INC. and JOHN DOE
CORP., NOS.
1 THROUGH 10,
Defendants,
and
ANGELO CALI, ASHFAQ AHMAD and IQBAL
AHMAD,
Additional Defendants
on the Counterclaim.
Argued February 2, 1998 -- Decided June 2, 1998
On certification to the Superior Court,
Appellate Division.
Peter R. Bray argued the cause for appellants
(Bray, Choicca, Rappaport & Rothstadt,
attorneys).
Dean A. Gaver argued the cause for
respondents (Hannoch Weisman, attorneys).
Robert H. Stoloff, Assistant Attorney
General, argued the cause for intervenor-respondent (Peter Verniero, Attorney General
of New Jersey, attorney; Joseph L. Yannotti,
Assistant Attorney General, of counsel).
The opinion of the Court was delivered by
GARIBALDI, J.
At issue in this case is whether the Alternative Procedure
for Dispute Resolution Act (the "APDRA"), N.J.S.A. 2A:23A-1 to -19, infringes on an individual's constitutional right to appeal
and on this Court's constitutional rulemaking authority. The
issue arises in the context of an umpire's award in a complex
real estate contract dispute. The Chancery Division confirmed
that award. The Appellate Division dismissed plaintiffs' appeal,
as barred by the APDRA. We granted certification,
151 N.J. 71
(1997), and now affirm the Appellate Division.
The subject matter of the dispute concerns a 1280 acre tract of land in Rockaway Township, Morris County, owned by the Mount Hope Mining Company (MHMC). In October 1985, the parties to this action, through a number of different entities, entered into a joint venture agreement to develop simultaneously two separate projects on the site: a hydroelectric project and a residential
project. The contract for the residential project required MHMC
to convey title to the site to a joint venture entity that was to
be formed, which entity became the Mt. Hope Development
Associates (MHDA). Both projects required many approvals from
various federal, state, and local agencies. The approval process
took place between October 1985 and October 1994.
Shortly after embarking on the joint venture, the parties
had a major falling-out. Throughout their attempts to complete
both projects, the parties spent a great deal of time and money
litigating various disputes. In connection with one of those
disputes, on February 27, 1989, the parties entered into a
settlement agreement, which was embodied in a consent judgment.
Paragraph 13 of that consent judgment stated:
The parties agree to submit any dispute as to the
rights and obligations of the respective parties for
resolution under the New Jersey Alternative Dispute
Resolution Act, 2A-23A-1 et seq. The parties agree
that the umpire shall be entitled to award damages
and/or reasonable attorney's fees to the prevailing
party in such proceeding.
Following that settlement, the relationship between the parties did not improve. On November 12, 1990, the parties executed another agreement that they hoped would be a comprehensive settlement. Nevertheless, the relationship between the parties continued to deteriorate. On December 3, 1992, MHDA filed suit in the Chancery Division, Morris County, against several of the parties involved in both projects. Defendants moved to compel alternative dispute resolution based on the February 27, 1989 consent judgment. On June 17, 1993, the court
entered a consent order staying the action and compelling APDRA
proceedings. Subsequently, by mutual agreement, the parties
chose Harvey Smith, a retired Superior Court Judge, to be the
umpire. In that proceeding, the parties made cross-allegations
of breach of contract, conspiracy, tortious interference with
contract, and fraud. Both sides also sought accountings.
The APDRA proceedings began in April 1994. The proceedings
consisted of twenty days of testimonial hearings, including the
testimony of twenty-one individuals and over 330 exhibits. Over
the course of the APDRA proceedings, Umpire Smith made several
interim and final written awards and orders. The umpire rendered
a written award for defendants dated November 21, 1994. That
award was modified on January 17, 1996. In addition, on April
24, 1996, the umpire directed the execution of a limited
partnership agreement. On July 3, 1996, the umpire entered a
“Summary of Disposition of Claims,” which tracked the award to
the various corresponding claims in the pleadings. In his award,
the umpire made findings of facts and conclusions of law.
On June 6, 1996, MHDA filed a motion in the Superior Court,
Chancery Division, to vacate or modify the award. Defendants
moved to confirm the award. On October 17, 1996, the Chancery
Division confirmed the award. MHDA filed an appeal with the
Appellate Division. Defendants moved to dismiss the appeal on
the grounds that under the APDRA, plaintiffs waived their right
to appeal. On January 27, 1997, the Appellate Division granted
defendants' motion to dismiss.
The Alternative Procedure for Dispute Resolution Act was enacted in 1987 to:
create a new procedure for dispute resolution which would be an alternative to the present civil justice system and arbitration system of settling disputes. It is intended to provide a speedier and less expensive process for resolution of disputes than traditional civil litigation and would provide parties with rights that are not currently available under New Jersey's Arbitration Act.
[Governor's Reconsideration and Recommendation
Statement to Assembly Bill No. 296, at 1 (Jan. 7,
1987), reprinted at N.J.S.A. 2A:23A-1.]
See also Draftsman's Legislative History, reprinted at N.J.S.A.
2A:23A-1 ("It is hoped that through the enactment of the NJADR
Act those parties that want a formal method of resolving disputes
with predictable rules, procedures, and results but without the
costs and delays associated with traditional litigation can be
accommodated.").
The APDRA is a voluntary procedure for alternative dispute
resolution that is only operative when parties to a contract
agree to be governed by it. N.J.S.A. 2A:23A-2; see also John v.
O'Hara, The New Jersey Alternative Procedure for Dispute
Resolution Act: Vanguard of a "Better Way?",
136 U. Pa. L. Rev.
1723, 1752 n.176 (1988) (stating APDRA "is entirely voluntary and
must be designated by the parties as the source of rules
governing dispute resolution"). For parties to be bound by the
APDRA, it is "sufficient that [they] signify their intention to
resolve their dispute by reference in the agreement to 'The New
Jersey Alternative Procedure for Dispute Resolution Act.'"
N.J.S.A. 2A:23A-2(a). The APDRA may be invoked to settle any
controversy arising out of a contract, and parties to an existing
controversy may agree to have their controversy resolved under
the APDRA. Ibid.
Parties to an APDRA proceeding are entitled to discovery.
N.J.S.A. 2A:23A-10. The dispute is heard by an umpire, N.J.S.A.
2A:23A-9, who is required to make an "award on all issues
submitted for alternative resolution in accordance with
applicable principles of substantive law." N.J.S.A. 2A:23A-12(e). That award must be acknowledged and in writing, and must
"state findings of all relevant material facts, and make all
applicable determinations of law." N.J.S.A. 2A:23A-12(a).
Within twenty days after delivery of the award, the umpire may
modify the award for certain enumerated errors. N.J.S.A. 2A:23A-12(d).
After the award is delivered by the umpire, the parties have
forty-five days (thirty days if the award is modified) to
commence a summary action in the Chancery Division of the
Superior Court to vacate, correct, or modify the award. N.J.S.A.
2A:23A-13(a). The APDRA further provides that once a court
grants an order confirming, modifying, or correcting an award, "a
judgment or decree shall be entered by the court in conformity
therewith and be enforced as any other judgment or decree. There
shall be no further review of the judgment or decree." N.J.S.A.
2A:23A-18(b) (emphasis added).
Pursuant to N.J.S.A. 2A:23A-18(b), the Appellate Division
dismissed plaintiffs' appeal from the Chancery Division's
confirmation of the umpire's award. Plaintiffs assert that the
APDRA violates their constitutional right to appeal and intrudes
on this Court's constitutional rulemaking authority. We discuss
each assertion in turn.
Article VI, Section 5, paragraph 2 of the New Jersey Constitution guarantees the right to appeal from a final decision of the Law and Chancery Divisions of the Superior Court and in such other cases as may be provided by law. Additionally, that right to appellate review is "secured against legislative interference by Article VI, Section II, paragraph 2, Section III, paragraph 3, Section V, paragraphs 1, 2, and Article XI, Section IV, paragraph 3 [of the New Jersey Constitution]." Hager v. Weber, 7 N.J. 201, 205 (1951).
Although the New Jersey Constitution grants parties the right to appeal,
[t]he general rule . . . is that a party may, by express agreement or stipulation before trial or judgment, waive his right to appeal, and such agreements or stipulations will be enforced by dismissal of the appeal taken out of violation thereof, or by refusing to pass upon questions covered by the waiver. The intention and agreement to waive the right of appeal must be clear, and there must be sufficient consideration. Such agreements are upheld upon the grounds of public policy in encouraging litigants to accept as final decisions of courts of original jurisdiction.
See also State v. Gibson,
68 N.J. 499, 511 (1975) (stating, in
reference to policy of encouraging civil and criminal
settlements, that "we do not share the view that there is an
affirmative public policy to be served in fostering appeals,
whether civil or criminal, such that the waiver of an appeal by
defendant is per se against public interest"); cf. New Jersey
Mfr. Ins. Co. v. Travelers Ins. Co.,
198 N.J. Super. 9, 12-13
(App. Div. 1984) (holding that waiver of appeal provision in
inter-company arbitration agreement is valid and enforceable).
That rule is in accord with the general rule permitting waiver of
constitutional rights. See Miranda v. Arizona,
384 U.S. 436,
16 L. Ed.2d 694,
86 S. Ct. 1602 (1966) (allowing waiver of
privilege against self- incrimination); Sexton v. Newark Dist.
Tel. Co.,
84 N.J.L. 85, 101, aff'd,
86 N.J.L. 701 (1913)
(allowing waiver of right to trial by jury).
The first question, therefore, is whether the APDRA clearly
informs parties that by invoking its procedures, parties are
waiving their right to appeal. We believe the language of APDRA
unmistakeably informs parties that by utilizing its procedures
they are waiving that right.
Several sections in the statute make express reference to
the limitation on appeals. N.J.S.A. 2A:23A-2, which instructs
parties how to invoke APDRA's procedures, is entitled "Contracts
to Submit; enforcement of submission; waiver of right to trial by
jury and appeal." (emphasis added). That section specifically
states:
Any contract provision or agreement described in
subsection a. of this section shall be construed
as an implied consent by the parties to the
jurisdiction of the Superior Court to enforce that
provision or agreement pursuant to the provisions
set forth in this Act and to enter judgment
thereon. The contract provision or agreement
shall constitute a waiver by the parties of the
right to trial by jury and to appeal or review,
except as specifically provided for in this Act.
(emphasis added).
Likewise, N.J.S.A. 2A:23A-18(b). provides:
Upon the granting of an order confirming,
modifying or correcting an award, the
judgment or decree shall be entered by the
court in conformity therewith and be enforced
as any other judgment or decree. There shall
be no further appeal or review of the
judgment or decree. (emphasis added).
Similarly, N.J.S.A. 2A:23A-5(b). provides that "[a]n appeal
from a final award decision by the umpire may be obtained only as
provided in section 13 of this Act." (emphasis added). Finally,
emphasizing the importance of limited review, N.J.S.A. 2A:23-19
provides:
This Act shall be liberally construed to
effectuate its remedial purpose of allowing
parties by agreement to have resolution of
factual and legal issues in accordance with
informal proceedings and limited judicial
review in an expedited manner. (emphasis
added).
See also Draftsman's Legislative History reprinted at N.J.S.A.
2A:23A-1 to -19 ("[T]he only appeal of an umpire's award
contemplated by the NJADR Act is an expedited summary review to
the Chancery Division of the New Jersey Superior Court."). Those
provisions make it clear that, in invoking APDRA, individuals are
waiving both their right to appeal and their right to trial by
jury.
Parties invoking arbitration to settle a dispute also waive
some constitutional rights. They waive their right to trial by
jury. See Allgor v. Travelers Ins. Co.,
280 N.J. Super. 254, 263
(1995). Also, because an arbitration award "may be vacated only
for fraud, corruption, or similar wrong doing on the part of the
arbitrators," Tretina Printing, Inc. v. Fitzpatrick & Assocs.,
Inc.,
135 N.J. 349, 358 (1994) (quoting Perini Corp. v. Greate
Bay Hotel & Casino, Inc.,
129 N.J. 479, 548 (1992) (Wilentz,
C.J., concurring)), parties to arbitration also waive, to some
extent, their right to appeal. There is no distinction between
arbitration and the APDRA that would prohibit parties who invoke
the APDRA from likewise waiving those rights. Indeed, the public
policy underlying the APDRA is essentially the same as that
underlying the Arbitration Act, N.J.S.A. 2A:24-1 to -11:
"finality and limited judicial involvement." Tretina Printing,
supra, 135 N.J. at 361.
In this case, the parties are highly sophisticated
businessmen who were represented by counsel when they entered
into the consent judgment that specifically bound them to use the
APDRA's procedures to resolve their disputes. Also, during the
extensive APDRA proceedings, no objection was made to proceeding
under the APDRA. Plaintiffs' late assertion that they did not
make a knowing and intelligent waiver of their right to appeal is
not credible.
Although limited judicial review is a central component of
the APDRA, the APDRA's procedures are entirely voluntary, and
thus, parties are free to invoke its procedure in toto or subject
to agreed upon modifications. See Tretina Printing, supra, 135
N.J. at 358 (noting in context of arbitration statute's limited
review that parties are free to expand the scope of judicial
review by providing for such expansion in their contract). Had
the parties to this action desired to preserve their right to
appeal, they could have inserted a provision into the consent
judgment reserving that right and delineating the scope and
extent of any appeal. They did not do so.
A separate, albeit closely related issue, is whether the Legislature, by its enactment of the APDRA, impinged on the power of this Court to control the practice and procedure of the courts in general and the power to regulate appeals in particular. Article VI, Section 2, paragraph 3 of the New Jersey Constitution provides: "The Supreme Court shall make rules governing the administration of all courts in the state and, subject to the law, the practice and procedure in all such courts." That provision has been broadly defined to vest this Court with the exclusive jurisdiction to administer the courts of this State. See Winberry v. Salisbury, 5 N.J. 240, 255, cert. denied, 340 U.S. 877, 71 S. Ct. 1223, 95 L. Ed. 638 (1950); In re Matterra, 34 N.J. 259 (1961).
In Winberry, supra, we considered whether a statute
providing for an appeal within a year had supremacy over a Court
Rule requiring the filing of an appeal within forty-five days.
The Court concluded that because Article VI, Section 2, paragraph
3 of the New Jersey Constitution grants this Court the exclusive
power to control the courts, subject only to substantive law, the
Rule had supremacy. Winberry, supra, 5 N.J. at 9.
The doctrine of separation of powers is fundamental to our
State government. Communications Workers of Am. v. Florio,
130 N.J. 439, 449 (1992). Article III, paragraph 1 of the New
Jersey Constitution specifically prohibits any one branch of
government from exercising powers belonging to a coordinate
branch. Nevertheless, we have always recognized that provisions
of the State Constitution prohibiting one branch of government
from infringing on the power of the other "requires not an
absolute division of power but a cooperative accommodation among
the three branches of government." Ibid. (citing General
Assembly v. Byrne,
90 N.J. 376, 382 (1982); Knight v. Margate,
86 N.J. 374, 388 (1981); Brown v. Heymann,
62 N.J. 1, 11 (1972)).
Also, it is well-settled that "a legislative enactment will not
be declared void unless its repugnancy to the Constitution is so
manifest as to leave no room for reasonable doubt." Smith v.
Penta,
81 N.J. 65, 75 (1979).
Relevant to this case is Rule 2:2-3(a)(1), which grants the
right to appeal to the Appellate Division from a final judgment
of the Chancery or Law Division. Plaintiffs assert that the
Legislature, through the enactment of the APDRA, has attempted to
circumscribe that Rule, in violation of Winberry and this Court's
constitutional authority. We do not find that the APDRA
infringes on this Court's authority.
Rule 2:2-3(a)(1) merely implements the constitutional right
to appeal. Just as the constitutional right to appeal may be
waived, so may the right granted by R. 2:2-3(a)(1).
Additionally, the APDRA, unlike most statutes, is not self
executing. It is a voluntary procedure that only applies if it
is invoked in a written agreement. It imposes no restrictions on
the Court or any party. Also, because there are so many other
avenues to resolve disputes, a party that does not choose the
APDRA suffers no adverse consequences. In essence, through the
enactment of the APDRA, the Legislature has created a blueprint
for those parties who want their dispute settled by APDRA so that
they do not have to negotiate a complete set of dispute
resolution procedures. Because the Legislature has simply
created a voluntary system of dispute resolution procedures,
the Legislature has not attempted to override any Court Rule
promulgated by this Court, has not intruded on this Court's
authority, and has not violated the doctrine of separation of
powers.
We have often stressed this State's strong public policy
favoring arbitration as well as other alternative dispute
mechanisms. See Faherty v. Faherty,
97 N.J. 99, 105 (1984) ("In
this state, as in most American jurisdictions, arbitration is a
favored remedy."); Barcon Assocs., Inc. v. Tri-County Asphalt
Co.,
86 N.J. 179, 186 (1981) (stating that arbitration is favored
by the courts in this state). In so doing, we have recognized
the "needs of a modern society to develop desirable alternatives
to litigation. Our guiding principles should strengthen the
systems that encourage those alternatives to litigation, not
weaken them." Perini Corp., supra, 129 N.J. at 489. Prohibiting
the Legislature from creating a voluntary system of alternative
dispute resolution would be contrary to those principles.
Appellants have not alleged any of those "rare circumstances" grounded in public policy that might compel this Court to grant limited appellate review. Tretina Printing, supra, 135 N.J. at 364-65. For example, in Faherty, supra, 97 N.J. at 109, we addressed the enforceability of an award affecting child support. We held that an award that adversely affects the substantial best interest of the child must be subject to review beyond the statutory grounds for vacation or modification provided in N.J.S.A. 2A:24-8. In reaching that conclusion, we "recognize[d] that courts have a nondelegable, special supervisory function in the area of child support that may be exercised upon review of an arbitrator's award." 97 N.J. at 109. As with arbitration, when parties proceed under the APDRA, there may be other limited circumstances where public policy would require appellate court review. For instance,
because of this Court's supervisory function over the courts, we
may determine that an award that is confirmed, modified, or
vacated by a biased court should be subject to review beyond that
which is provided for in N.J.S.A. 2A:23A-18. Such issues,
however, are not present in this case.
The parties knowingly agreed to resolve their disputes under the APDRA, which provides for a limited right of appeal. The APDRA does not infringe on the parties' constitutional right to appeal or this Court's constitutional rulemaking authority.
The Appellate Division properly dismissed plaintiffs' appeal. The judgment of the Appellate Division is affirmed.
CHIEF JUSTICE PORITZ and JUSTICES HANDLER, POLLOCK, O'HERN,
and COLEMAN join in JUSTICE GARIBALDI's opinion. JUSTICE STEIN
has filed a separate concurring opinion.
SUPREME COURT OF NEW JERSEY
A-
77 September Term 1997
MT. HOPE DEVELOPMENT ASSOCIATES,
EAJ, INC., and HUNDAL CORPORATION,
Plaintiffs-Appellants,
v.
MT. HOPE WATERPOWER PROJECT, L.P.,
MT. HOPE MINING COMPANY, INC.,
HALECREST COMPANY, MT. HOPE HYDRO
INC., MT. HOPE PROPERTIES, INC.,
KVAERNER HYDRO POWER, INC. and
PAUL RODZIANKO,
Defendants-Respondents,
and
ATTORNEY GENERAL OF NEW JERSEY,
Intervenor-Respondent,
and
ABB GENERATION, INC. and JOHN DOE
CORP., NOS.
1 THROUGH 10,
Defendants,
and
ANGELO CALI, ASHFAQ AHMAD and IQBAL
AHMAD,
Additional Defendants
on the Counterclaim.
STEIN, J. concurring in part and dissenting in part.
This appeal presents a constitutional issue of substantial magnitude. The question posed concerns the constitutionality of provisions of the Alternate Procedure for Dispute Resolution Act
(the Act or APDRA), N.J.S.A. 2A:23A-1 to -19, that purport to
eliminate all judicial review of any order of the Chancery
Division confirming, modifying or correcting an umpire's award
issued pursuant to APDRA. The Act states:
"Upon the granting of
an order confirming, modifying or correcting an award, a judgment
or decree shall be entered by the court in conformity therewith
and be enforced as any other judgment or decree. There shall be
no further appeal or review of the judgment or decree." N.J.S.A.
2A:23A-18b.
On its face, the Act's limitation of judicial review that
eliminates appeals to the Appellate Division from Chancery
Division orders confirming or modifying awards directly infringes
on the right to appellate review guaranteed by the New Jersey
Constitution. Article VI, Section 5, paragraph 2 guarantees the
right of appeal from all final decisions of the Law and Chancery
Divisions and in such other cases as may be provided by law.
This Court has held expressly that the right to appellate review
"is a remedial procedure secured against legislative interference
by Article VI, Section II, paragraph 2, Section III, paragraph 3,
Section V, paragraphs 1, 2 and Article XI, Section IV, paragraph
3." Hager v. Weber,
7 N.J. 201, 205-06 (1951). Moreover, the
statute on its face conflicts with Rule 2:2-3(a)(1), promulgated
by this Court pursuant to its constitutional authority, Article
VI, Section 2, paragraph 3, that Court Rule expressly authorizing
appeals as of right to the Appellate Division from final
judgments of the Chancery or Law Divisions. That this Court's
exclusive power to promulgate rules governing practice and
procedure in all courts supersedes any legislative enactment
purporting to govern or limit the right of appeal is no longer
open to debate. See Winberry v. Salisbury,
5 N.J. 240, 255,
cert. denied,
340 U.S. 877,
71 S. Ct. 123,
95 L. Ed. 638 (1950).
In recognition of the potential vulnerability of APDRA to
constitutional challenge, the Court has avoided the issue by
construing the Act to permit parties electing to arbitrate
pursuant to APDRA's provisions either to preserve or waive the
constitutionally protected right to appellate review. The Court
holds:
Although limited judicial review is a
central component of the APDRA, the APDRA's
procedures are entirely voluntary, and thus,
parties are free to invoke its procedure in
toto or subject to agreed upon modifications.
See Tretina Printing[, Inc. v. Fitzpatrick &
Assocs., Inc.,
135 N.J. 349, 358 (1994)]
(noting in context of arbitration statute's
limited review that parties are free to
expand the scope of judicial review by
providing for such expansion in their
contract). Had the parties to this action
desired to preserve their right to appeal,
they could have inserted a provision into the
consent judgment reserving that right and
delineating the scope and extent of any
appeal. They did not do so.
[Ante at ___ (slip op. at 11)
(emphasis added).]
In my view, the Court's pragmatic interpretation of the Act that extends to parties who elect to arbitrate disputes pursuant to the Act's provisions the option either to preserve or forego the constitutional right of appellate review satisfactorily addresses and resolves the constitutional challenge. The Court's
interpretation of the Act is faithful to our obligation to
construe a statute in a manner that sustains its
constitutionality if the statute is reasonably susceptible to
such a construction. See State v. Mortimer,
135 N.J. 517, 534
(1994), cert. denied,
513 U.S. 970,
115 S. Ct. 440,
130 L. Ed.2d 351 (1994).
I disagree only with the aspect of the Court's disposition
that precludes appellate review to plaintiff. As the Court's
opinion explains, the parties' agreement to submit disputes
between them for resolution pursuant to APDRA was embodied in a
consent judgment that simply identified the Act by title as the
mechanism by which disputes would be resolved, ante at ___ (slip
op. at 3), without any reference whatsoever to the right of
appellate review. When the parties entered into that agreement
they obviously were unaware that the Act would be construed by
the Court to permit parties proceeding under APDRA to elect to
preserve appellate review. Nor does the provision of the consent
judgment relating to APDRA meet the level of specificity required
to sustain a waiver of constitutional right.
"'[C]ourts indulge
every reasonable presumption against waiver' of fundamental
constitutional rights and . . . 'do not presume acquiescence in
the loss of fundamental rights.'" Johnson v. Zerbst,
304 U.S. 458, 464,
58 S. Ct. 1019, 1023,
82 L. Ed. 1461, 1466 (quoting
Aetna Ins. Co. v. Kennedy,
301 U.S. 389, 393,
57 S. Ct. 809, 811-12,
81 L. Ed. 1177, 1180 (1937) and Ohio Bell Tel. Co. v. Public
Utils. Comm'n,
301 U.S. 292, 307,
57 S. Ct. 724, 731,
81 L. Ed. 1093, 1103 (1937)); State v. Buonadonna,
122 N.J. 22, 35 (1991)
.
The presumption against waiver of constitutional rights
applies in civil cases with the same force as it does in criminal
prosecutions. Fuentes v. Shevin,
407 U.S. 67, 94 n.31,
92 S. Ct. 1983, 2001 n.31,
32 L. Ed.2d 556, 578 n.31 (1972); Callen v.
Sherman's, Inc.,
92 N.J. 114, 137 (1983). Constitutional rights
may be waived in the commercial context, but such waiver must be
clear and explicit. Ibid. The United States Supreme Court has
held that unless the contractual language, on its face,
constitutes such a waiver, no waiver of a constitutional right
will be found. Fuentes, supra, 407 U.S. at 95, 92 S. Ct. at
2002, 32 L. Ed.
2d at 579.
Because the right to appellate review under APDRA had not
been established when the parties agreed to be bound by the Act's
provisions, and because the waiver of the constitutionally
protected right of appellate review was neither clear nor
explicit, I would accord plaintiff the right of review by the
Appellate Division of the Chancery Division's judgment.
NO. A-77 SEPTEMBER TERM 1997
ON APPEAL FROM
ON CERTIFICATION TO Appellate Division, Superior Court
MT. HOPE DEVELOPMENT ASSOCIATES, et al.,
Plaintiffs-Appellants,
v.
MT. HOPE WATERPOWER PROJECT, L.P., et al.,
Defendants-Respondents,
and
ATTORNEY GENERAL OF NEW JERSEY,
Intervenor-Respondent,
and
ABB GENERATION, INC., et al.,
Defendants,
and
ANGELO CALI, et al.,
Additional Defendants
on the Counterclaim.
DECIDED June 2, 1998
Chief Justice Poritz PRESIDING
OPINION BY Justice Garibaldi
CONCURRING/DISSENTING OPINION BY Justice Stein
DISSENTING OPINION BY