Title: Municipal Council of the City of Newark v. Sharpe James, Mayor of the City of Newark et als.

State: new-jersey

Issuer: New Jersey Supreme Court

Document:

(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). The City of Newark is organized under the statutory scheme of the Optional Municipal Charter Law, N.J.S.A. 40:69A-1 to -210, (the Faulkner Act). The Faulkner Act authorizes participating municipalities to choose from among four plans of government set forth in the Act. The City of Newark s municipal government is organized under the mayor-council plan C form of government set forth in Sections 60.1 through 60.7 of the Act. The mayor-council plan is very close to the presidential or gubernatorial form in its concentration of power in the hands of a popularly elected mayor. The authority of the mayor under this plan is substantial and the mayor-council plan has been adopted by most of New Jersey s largest municipalities. Under the mayor-council plan, the municipality is governed by an elected council and an elected mayor. Generally, all administrative and executive functions assigned by law to the governing body are exercised by the mayor, while the legislative and investigative functions are exercised by the council. Since approximately 1986, the Mayor proposed municipal budgets that included appropriations to fund contracts for consulting services to be performed by consultants that the City Council would retain to assist it in carrying out its legislative, investigatory, and auditing responsibilities. In practice, once the budget was adopted, City Council adopted resolutions, rather than ordinances requiring the Mayor s approval, by which City Council retained the consultants it deemed necessary to carry out its duties. Until 1995, City Council directly entered into those consultant contracts on its own authority. However, based on Corporation Counsel s advice, a new three-step procedure was put into effect in 1995: City Council would adopt a resolution authorizing the entry into a consultant contract, the resolution would then be reviewed and approved by Corporation Counsel, and the City Clerk would execute the consultant contract. In 2002, following the Mayor s re-election for a fifth consecutive term, the City s then Corporation Council undertook an analysis of the Mayor s and City Council s rights and obligations under the Faulkner Act as then practiced in Newark. Corporation Counsel opined that the existing practice by City Council was in derogation of the Faulkner Act because the statute expressly empowers only a mayor with the statutory authority to negotiate and sign contracts on behalf of the municipality. As a result, Corporation Counsel refused to approve any resolution-based contracts and the City s Director of Finance refused to certify funds for the challenged contracts. Corporation Counsel s actions created two categories of affected contracts: those contracts previously approved by both City Council and Corporation Counsel for which funds had been certified by the Director of Finance and that had been either partially or fully performed but remained unpaid, and those contracts that had been approved by City Council but rejected by Corporation Counsel. Ultimately, the only contracts in dispute were the consultant contract resolutions rejected by Corporation Counsel, consisting of about fifteen separate contracts worth over $1.7 million. In February 2003, City Council filed a complaint seeking injunctive relief and declaratory relief compelling the Mayor, Corporation Counsel, and the Director of Finance to return to the previous contract procedure. The Mayor, Corporation Counsel and the Director of Finance responded by seeking a declaration that only the Mayor could initiate, negotiate, or sign contracts for the City under the Faulkner Act, which then could be accepted or rejected by City Council in accordance with procedures in the Act. They also sought an injunction prohibiting City Council from initiating, negotiating, awarding, and executing contracts on its own or through the City Clerk. A hearing was held on May 30, 2003 before the trial court, which denied City Council s applications to have its pending contract resolutions approved by Corporation Counsel and funds certified by the Director of Finance. Instead, the court granted declaratory judgment in favor of the Mayor, Corporation Counsel and the Director of Finance, holding that, under the Faulkner Act, the Mayor is responsible for initiating, negotiating, and signing contracts and the City Council is responsible for approving or rejecting those contracts presented by the Mayor. The trial court determined that City Council does not have the authority to unilaterally retain consultants, nor does it have the authority to tell the Mayor to certify the funds to implement those contracts. City Council appealed to the Appellate Division, which affirmed the decision of the trial court. The Supreme Court granted certification. HELD: Under the circumstances presented here, the statutory scheme of the Faulkner Act, under which the City of Newark is organized, allocates the responsibility for initiating, negotiating, and signing contracts to the Mayor, while City Council is charged with approving or rejecting the contracts presented to it by the Mayor. 1. The Faulkner Act s mandate is clear and unmistakable the Mayor is charged with the duty to negotiate and sign contracts that bind the City of Newark, subject to City Council s approval, while City Council is charged with the duty of approving or rejecting those contracts presented to it by the mayor. There is no room for the interpretation advanced by City Council that would give the responsibility for negotiating and signing contracts for City Council s consultants to City Council alone. This conclusion is underscored by the 1985 Lynch Amendment to the Faulkner Act. (Pp. 13-17) 2. City Council relies on the Lynch Amendment, the Appellate Division opinion in Newark City Council v. James, and the Governor s Reconsideration and Recommendation Statement, Statement to Senate Bill 1206, to argue that, as a matter of law, it is entitled to unilaterally issue contracts for consultant services. These cited authorities are neither persuasive nor controlling. (Pp. 17-19) 3. In light of the assignment of contracting duties already set forth in the Faulkner Act, the Lynch Amendment cannot be reasonably read to extend as far as City Council would have it reach, giving it contracting authority on its own. (Pp. 19-20) 4. City Council argues that Section 5 of the Local Public Contracts Law allows a governing body to purchase professional services by resolution, without public advertisements or competitive bids; therefore, City Council can purchase professional services without input from the Mayor. That reading of the Local Public Contracts Law is too expansive and is contrary to the balanced scheme created by the mayor-council plan of government under the Faulkner Act. (Pp. 20-21) 5. The Faulkner Act burdens the Mayor and City Council with working cooperatively for the benefit of the municipalities residents. There are or will be instances when either the Mayor or City Council should subordinate their respective authority as a matter of simple social harmony and proper statesmanship. (Pp. 21-22) Judgment of the Appellate Division is AFFIRMED. CHIEF JUSTICE PORITZ and JUSTICES LONG, LaVECCHIA, ZAZZALI and WALLACE join in JUSTICE RIVERA-SOTO S opinion. JUSTICE ALBIN did not participate. Plaintiff-Appellant, v. SHARPE JAMES, MAYOR OF THE CITY OF NEWARK, JOANNE Y. WATSON, CORPORATION COUNSEL OF THE CITY OF NEWARK, and DANIEL GONZALEZ, DIRECTOR OF FINANCE, Defendants-Respondents. Argued January 31, 2005 Decided May 24, 2005 On certification to the Superior Court, Appellate Division. Salvatore Perillo argued the cause for appellant (Perskie Nehmad & Perillo, attorneys). Angelo J. Genova argued the cause for respondents (Genova, Burns & Vernoia, attorneys; Celia S. Bosco, on the brief). JUSTICE RIVERA-SOTO delivered the opinion of the Court. In our representative democracy, clashes of authority between branches of government are the means by which the tensions among them are defined and, ultimately, resolved. This appeal presents one such conflict, pitting the Municipal Council of the City of Newark against its Mayor. We hold that, under the circumstances presented here, the statutory scheme of the Optional Municipal Charter Law, N.J.S.A. 40:69A-1 to -210 (the Faulkner Act), under which the City of Newark is organized, allocates the responsibility for initiating, negotiating, and signing contracts to the mayor of the municipality, while the city council is charged with approving or rejecting the contracts presented to it by the mayor. [Id. at 330 (citation omitted).] Pursuant to a referendum adopted in 1953 by the voters of the City of Newark and effective July 1, 1954, the City of Newark s municipal government is organized under the mayor-council plan C form of government set forth in Sections 60.1 through 60.7 of the Faulkner Act. N.J.S.A. 40:69A-60.1 to -60.7. The unique characteristics of the Faulkner Act s mayor-council plan bear special note: That plan is distinguishable from the other options because it is quite close to the presidential or gubernatorial form in its concentration of power in the hands of a highly-visible, independently-elected Chief Executive who has substantial power over the administration. The mayor in a Faulkner mayor-council plan is elected by popular vote to a four-year term. . . . . The mayor s authority under the Faulkner Act s mayor-council plan is, therefore, substantial, and [i]t is no accident that this plan has been adopted by virtually all of New Jersey s largest municipalities -- places in which there is a need for visible, effective leadership to pursue programs with the full support of the administration. . . . . The office of Mayor in Jersey City, as in other large cities that have adopted the Faulkner Act, is one of the most powerful municipal offices in this State, created pursuant to a law that was designed to provide municipalities with unique authority and flexibility to organize municipal governments according to local preferences. [McCann v. Clerk of City of Jersey City, supra, 167 N.J. 330-31 (citations omitted).] Generally, the mayor-council plan under the Faulkner Act provides that [e]ach municipality . . . shall be governed by an elected council, and an elected mayor. . . . , N.J.S.A. 40:69A-32(a), and that unless the explicit terms and context of the statute require a contrary construction, any administrative or executive functions assigned by general law to the governing body shall be exercised by the mayor, and any legislative and investigative functions assigned by general law to the governing body shall be exercised by the council. N.J.S.A. 40:69A-32(b). More specifically, under the mayor-council plan, the Faulkner Act allocates to the mayor [t]he executive power of the municipality , N.J.S.A. 40:69A-39, and in detail assigns to the mayor the duty to: a. Enforce the charter and ordinances of the municipality and all general laws applicable thereto; b. Report annually to the council and to the public on the state of the municipality, and the work of the previous year; he shall also recommend to the council whatever action or programs he deems necessary for the improvement of the municipality and the welfare of its residents. He may from time to time recommend any action or programs he deems necessary or desirable for the municipality to undertake; c. Supervise, direct and control all departments of the municipal government and shall require each department to make an annual and such other reports on its work as he may deem desirable; d. Require such reports and examine such accounts, records and operations of any board, commission or other agency of municipal government, as he deems necessary; e. Prepare and submit to the council for its consideration and adoption an annual operating budget and a capital budget, establish the schedules and procedures to be followed by all municipal departments, offices and agencies in connection therewith, and supervise and administer all phases of the budgetary process; f. Supervise the care and custody of all municipal property, institutions and agencies, and make recommendations concerning the nature and location of municipal improvements and execute improvements determined by the governing body; g. Sign all contracts, bonds or other instruments requiring consent of the municipality; h. Review, analyze and forecast trends of municipal services and finances and programs of all boards, commissions, agencies and other municipal bodies, and report and recommend thereon to the council; i. Supervise the development, installation and maintenance of centralized budgeting, personnel and purchasing procedures as may be authorized by ordinance; j. Negotiate contracts for the municipality, subject to council approval; k. Assure that all terms and conditions imposed in favor of the municipality or its inhabitants in any statute, franchise or other contract are faithfully kept and performed; l. Serve as an ex officio, nonvoting member of all appointive bodies in municipal government of which he is not an official voting member. [N.J.S.A. 40:69A-40.] In addition, the mayor specifically is charged with either approving or rejecting any ordinances adopted by the municipal council, N.J.S.A. 40:69A-41(a), casting the deciding vote in the case of a tie on filling a vacancy on the council, N.J.S.A. 40:69A-41(b), determining, subject to limits, the hiring, firing, salary, wages and other compensation of municipal administrative employees, N.J.S.A. 40:69A-43 and -43a, and the preparation of the municipal budget for submission to the council. N.J.S.A. 40:69A-45 and -46. On the other hand, the council under a Faulkner Act mayor-council plan has its own set of statutorily enumerated duties and limitations. Unlike the mayor, the council may only act by ordinance, except for the exercise of those powers that, under this plan of government or general law, do not require action by the mayor as a condition of approval for the exercise thereof, and may, therefore, be exercised by resolution . . . . N.J.S.A. 40:69A-36. The powers statutorily granted to the council include: a. The override of a veto of the mayor; b. The exercise of advice and consent to actions of the mayor; c. The conduct of legislative inquiry or investigation; d. The expression of disapproval of the removal by the mayor of officers or employees; e. The removal of any municipal officer for cause; f. The adoption of rules for the council; g. The establishment of times and places for council meetings; h. The establishment of the council as a committee of the whole and the delegation of any number of its members as an ad hoc committee; i. The declaration of emergencies respecting the passage of ordinances; j. The election, appointment, setting of salaries and removal of officers and employees of the council, subject to any pertinent civil service requirements and any pertinent contractual obligations, and within the general limits of the municipal budget; k. Designation of official newspapers; l. Approval of contracts presented by the mayor; m. Actions specified as resolutions in the Local Budget Law (N.J.S. 40A:4-1 et seq.) and the Local Fiscal Affairs Law (N.J.S. 40A:5-1 et seq.); and n. The expression of council policies or opinions which require no formal action by the mayor. [Ibid.] Stated generally, then, the mayor-council plan under the Faulkner Act vests in the mayor the responsibility for administrative and executive operations of the municipality, while reposing the ultimate legislative and concomitant investigative responsibilities in the council. It is this division of responsibilities that generates the controversy before us. And the Court further finds that the power of the chief executive with respect to the contracts in question are [sic] clearly those which fall within the exercise of his broad administrative and executive discretion and policymaking responsibilities vested in him by the Legislature, . . . . The Court finds certainly that there is no authority in the City Council to indeed negotiate those contracts nor to - to tell the Mayor to certify the funds in furtherance of - of the implementation of those contracts. The court therefor cannot and will not enjoin or restrain defendants from interfering with the performance of contracts in - in - in question. The Court will declare that the actions of the defendant, the Mayor of the City of Newark in his exercise of discretion in his refusal to certify funds for the contracts in question were entirely within the scope of his executive administrative and policy discretion. And the Court will declare as a matter of law that the contracts as they are presented within the perspective of the issues in this case as they pertain to either legislative, investigatory or auditing responsibilities may not be negotiated unilaterally but are part of a cooperative effort as spelled out explicitly under the powers delegated under the Faulkner Act. City Council appealed, and the Appellate Division, in an unpublished per curiam opinion, affirmed the judgment of the trial court. Municipal Council of the City of Newark v. James, No. A-5578-02T1 (App. Div. Jun. 24, 2004). We granted City Council s petition for certification, 182 N.J. 141 (2004). [Merin v. Maglaki, 126 N.J. 430, 434-35 (1992).] See also Burns v. Belafsky, 166 N.J. 466, 473 (2001) ( When dealing with questions of statutory construction, the Court first considers the plain meaning of the provision at issue. ); N.J.S.A. 1:1-1 ( In the construction of the laws and statutes of this state, both civil and criminal, words and phrases shall be read and construed with their context, and shall, unless inconsistent with the manifest intent of the legislature or unless another or different meaning is expressly indicated, be given their generally accepted meaning, according to the approved usage of the language. ). It is clear that the Faulkner Act envisions a tension between the executive and legislative branches of municipal government, one functionally similar to the tension inherent in any republic that provides for coordinate branches of government. Although the separation of powers doctrine applied to federal and state governments is not generally applicable to [the] mayor-council plan of government, the Faulkner Act plainly envisages some separation of functions between the Council (the legislative body) and the Mayor (the executive). In re Shain, 92 N.J. 524, 537, 457 A.2d 828 (1983). That separation of functions imposes certain limits on the Mayor and local council in governing the municipality. Id. at 538, 457 A.2d 828. Principles of separation of powers are applicable where the Legislature has specifically delegated to the mayor and to the council separate functions . . . . Where one branch of government has been specifically vested with the authority to act in a prescribed manner, neither of the other branches may usurp that authority. N.J.S.A. 40:69A-32(b); Communications Workers v. Florio, 130 N.J. 439, 463-64, 617 A.2d 223 (1992); David v. Vesta Co., 45 N.J. 301, 326, 212 A.2d 345 (1965). [Casamasino v. City of Jersey City, supra, 158 N.J. at 343.] The tension addressed in Casamasino v. City of Jersey City, supra, between and among branches of municipal government governed by the Faulkner Act requires that each hews closely to its statutory authority while, at the same time, cooperating with its coordinate branches. That obligation to cooperate, as both the trial court and the Appellate Division properly recognized, is the core of this case. The Faulkner Act s mandate is clear and unmistakable: the Mayor is charged with the duty to negotiate and sign, subject to City Council s approval, contracts that bind the City, N.J.S.A. 40:69A-40(j) and -40(g), and City Council is charged with the duty of [a]pproval of contracts presented by the mayor. N.J.S.A. 40:69A-36(l). There can be no room here for the interpretation advanced by City Council that would reserve the responsibility for negotiating and signing contracts for City Council s consultants to City Council alone. This conclusion is underscored by the 1985 Lynch Amendment to the Faulkner Act, where the Legislature amended that portion of the Faulkner Act that split the governance responsibilities between an elected council and an elected mayor so as to provide: For the purpose of the construction of all other applicable statutes, unless the explicit terms and context of the statute require a contrary construction, any administrative or executive functions assigned by general law to the governing body shall be exercised by the mayor, and any legislative and investigative functions assigned by general law to the governing body shall be exercised by the council. Those functions shall be exercised pursuant to the procedures set forth in this plan of government, unless other procedures are required by the specific terms of the general law. [N.J.S.A. 40:69A-32(b) (emphasis supplied).] In relevant part, the Faulkner Act defines general law as any law or provision of law, not inconsistent with this act, heretofore or hereafter enacted which is by its terms applicable or available to all municipalities. . . . N.J.S.A. 40:69A-28. Because the Faulkner Act explicitly empowers the Mayor to negotiate and sign all contracts, N.J.S.A. 40:69A-40(j) and -40(g), one need not engage in the exercise of parsing out the allocation of responsibilities set forth in the Lynch Amendment. MUNICIPAL COUNCIL OF THE CITY OF NEWARK, Plaintiff-Appellant, v. SHARPE JAMES, MAYOR OF THE CITY OF NEWARK, JOANNE Y. WATSON, CORPORATION COUNSEL OF THE CITY OF NEWARK, and DANIEL GONZALEZ, DIRECTOR OF FINANCE, Defendants-Respondents. DECIDED May 24, 2005 Chief Justice Poritz PRESIDING OPINION BY Justice Rivera-Soto CONCURRING/DISSENTING OPINIONS BY DISSENTING OPINION BY