Opinion ID: 2347494
Heading Depth: 1
Heading Rank: 3

Heading: Substantive Due Process Arbitrary and Unreasonable

Text: The final question to be considered is whether the various provisions of the ordinance are so arbitrary and unreasonable as to violate principles of equal protection and substantive due process. Plaintiffs contend that the rent increase formula violates principles of substantive due process in that it fails to permit landlords to pass through to their tenants all increases in operating costs. The standards of judicial review under those principles are discussed in the companion case of Hutton Park, supra, and need not be repeated. The conceptual soundness of the particular fashion in which the municipality has used the Consumer Price Index and as to the wisdom of the regulatory policy which it has adopted, [11] is not pertinent to the constitutional challenge made to the ordinance. The constitution does not require that rent control ordinances take a particular predetermined form; nor does it oblige the municipality to permit landlords to uniformly pass their costs through to their tenants. The ordinance does not on its face purport to represent an effort to guarantee landlords more than the constitutional minimum. Precisely the same reasons which led us to reject the contention that the ordinance is confiscatory also lead us to conclude that it does not violate principles of substantive due process. Hutton Park, supra, 68 N.J. at 572-574. Brunetti v. New Milford, supra, 68 N.J. at 591-592. Plaintiffs also attack this formula as violative of the equal protection clause of the fourteenth amendment to the federal constitution on the grounds that it fails to permit greater rent increases at the termination of multi-year leases than at the termination of leases extending over a single year. They contend that this irrationally discriminates against landlords who grant multi-year leases in that they are not permitted to pass on to the tenant rent increases reflecting increases in prices over the entire life of the previous lease. In reality, no landlord need have suffered injury insofar as the ordinance applies to multi-year leases granted after July 10, 1973, the effective date of the amendment to Ordinance No. 73:464 which requires that one-year and multi-year leases be treated the same. Such injury could have been avoided simply by not granting multi-year leases. This, according to the testimony of plaintiffs' witnesses, is the course which landlords in Parsippany-Troy Hills have in fact followed. The parties who do undoubtedly suffer some injury through the operation of this provision are the landlords who had multi-year leases in effect at the time of the enactment of that amendatory ordinance. In evaluating this allegation, it is well to remember that legislative bodies have broad discretionary powers in making legislative classifications: Equal protection is not denied because a regulatory statute might have gone farther than it did, or might have included some persons or classes of persons who were excluded. Regulatory need in a particular field may appear to the legislative mind in different dimensions and proportions; as more acute in one area than in another. Consequently the reform may proceed one step at a time, addressing itself to the aspect of the problem which seems the most pressing.