Court Opinion

ID: 9884270
Source: CourtListenerOpinion
Date Created: 2023-10-06 02:50:43.726421+00
Date Added: 2024-06-11T07:38:11.278526
License: Public Domain

*234Hall, J.
(concurring). If this were the first case to arise concerning the meaning and application of the public aid prohibitions of the New Jersey Constitution, I would think it ought to go the other way.
The provisions of the Constitution of 1947 are taken verbatim from earlier enactments. Art. VIII, sec. II, par. 1 was found in the Constitution of 1844 as Art. IV, sec. VI, par. 3. Art. VIII, sec. Ill, pars. 2 and 3, were copied from 1875 amendments to the 1844 document which became Art. I, pars. 19 and 20 thereof. The language is precise and positive, as well as all-encompassing, a fact not true of the analogous constitutional provisions of most other states. The terminology used is not generally susceptible of elastic construction like the phrases “due process of law” or “equal protection of the laws.”
The original purpose and intended scope of constitutional prohibitions like ours seem to me to become very plain when we recall the elementary general proposition that, even in the absence of a constitutional prohibition, a state or its political subdivisions may not utilize public moneys to the aid of individual interests and personal purposes of profit and gain which are not of a public character, thus perverting the power of taxation. Citizens’ Savings & Loan Association v. Topeka, 87 U. S. (20 Wall.) 655, 22 L. Ed. 455 (1875). This leading case was decided only a few months before the previously mentioned amendments to our constitution. It would therefore seem that the initial intent of those amendments, and similar enactments in many other states, was not just to prohibit use of public funds and credit for private enterprises of a nonpublic character, for no constitutional provision was needed therefor, but rather to make it unlawful to provide such aid even for privately owned operations having a public purpose. This thesis appears to undergird the rationale of those modern state decisions which hold that their constitutional provisions prohibit public assistance in the latter class of situations. State ex rel. Saxbe, Atty. Genl. v. Brand, 176 Ohio St. 44, 197 N. E. 2d 328 (Sup. Ct. 1964); Village of *235Moyie Springs v. Aurora Manufacturing Co., 82 Idaho 337, 353 P. 2d 767 (Sup. Ct. 1960); State ex rel. Beck v. City of York, 164 Neb. 223, 82 N. W. 2d 269 (Sup. Ct. 1957); State v. Town of North Miami, 59 So. 2d 779 (Fla. Sup. Ct. 1952).
Despite this basic background, courts of most states having constitutional public aid limitations in one form or another came to say that, broadly speaking, the prohibitions did not apply where the private enterprise aided had a public purpose or character. The expansion of the role of government in late years has naturally resulted in enlargement of the public function category. See the comprehensive review of the entire subject in Pinsky, “State Constitutional Limitations on Public Industrial Einancing: An Historical and Economic Approach,” 111 U. Pa. L. Rev. 265 (1963).
The New Jersey courts generally followed and developed this approach, with certain ramifications not necessary to be detailed here, and it became rather well established as a result of decisional law prior to the adoption of the Constitution of 1947. See, e. g., Rutgers College v. Morgan, 70 N. J. L. 460 (Sup. Ct. 1904), affirmed 71 N. J. L. 663 (E. & A. 1905); Morris and Essex R. R. Co. v. Newark, 76 N. J. L. 555 (E. & A. 1908); Wilentz v. Hendrickson, 135 N. J. Eg. 244 (E. & A. 1944). Identical re-enactment of the former provisions in 1947 must be said to amount to ratification of the prior construction. Subsequent cases have reiterated the doctrine. So I think it has to be said that the majority opinion correctly summarizes the law of this State to date in this respect. Even though it might well be thought that this interpretation of the constitutional prohibitions is fundamentally wrong, it seems quite improper to so hold at this late date.
The majority opinion, in effect, utilizes three criteria to take a public aid project out of the constitutional prohibitions, viz., that the purpose is a public one, that the nature of the enterprise is such as is likely to effectuate that purpose, and that a sufficient measure of public control is provided to assure effectuation and safeguard the public investment, so to *236speak. And this particular project is found to meet the criteria. Again I believe these conclusions accord with prior law as a logical modern development thereof. Therefore I concur with the result reached, but on the basis of precedent rather than principle.
I do feel, however, that approval of the legislation and scheme here involved carries non-applicability of the constitutional prohibitions about as far as can be without completely writing them off. Aiding unemployment is certainly a proper public purpose and the conditions precedent to aid are probably as tight as practicable. The effectuation of the public aim by means of the essentially marginal projects assisted by this legislation does, however, approach the speculative. The extent of subsequent public control over the enterprise and its continuance in service of the underlying purpose, as well as the protection of the public investment, once the loan is made, is minimal, although perhaps as much as can be practically imposed. Contractual consideration for the aid beyond the obligation to repay the loan, upon which the majority relies in good part, seems barely sufficient. But the scheme is essentially a federal one with very slight local financial participation.
If our precise and positive constitutional public aid limitations have become anachronistic and unrealistic in this day and age, as they very probably have, amendment of the organic document should be undertaken. Such a course is infinitely sounder and more desirable than changes therein made ad hoc by the judicial and legislative branches of government.
Justice Hanbman joins in this concurring opinion.
Hall and Haneman, JJ, concurring in result.
For affirmance — Chief Justice Weintuaub, and Justices Jacobs, Erancis, Proctor, Hall, Sci-ibttieo and HaneMAN — 7.
For reversal — None.